The National Commission of Markets and Competition (CNMC) is at the center of a commercial battle between the main cloud service providers. Google, Amazon, and Microsoft, along with other industry players, have presented their arguments to the Spanish regulatory body as part of a public consultation on the cloud computing market.
Cross accusations among tech giants
Google and Amazon have directly pointed fingers at Microsoft for allegedly hindering competition in the Spanish market. Both companies accuse the Redmond firm of making changes to their licensing conditions that obstruct the use of their software products on rival cloud platforms.
Amazon Web Services (AWS) argues in their document submitted to the CNMC that Microsoft’s licensing practices “make it financially unviable to choose other providers.” On the other hand, Google argues that these policies “distort competition” and practically force Microsoft’s traditional customers to use their Azure platform.
The perspective of smaller providers
OVHCloud, a French company considered one of the main independent cloud service platforms, has also participated in the consultation. The company highlights the high market concentration, noting that Microsoft, Amazon, and Google control over 72% of the market share in Europe.
Furthermore, OVHCloud has identified several practices they consider anticompetitive, such as discounts conditioned on minimum spending commitments, difficulties in migrating between services, and software and hardware bundling that discourages switching to other providers.
Microsoft’s defense
In response to the accusations, Microsoft has taken a more subtle approach in their response to the CNMC. The company questions its dominant position, suggesting that AWS could be the actual market leader. Additionally, Microsoft argues that there is ease in interoperability and switching between different cloud platforms, presenting a very different landscape than that described by its competitors.
The role of the CNMC and the international context
The public consultation launched by the CNMC is part of a broader study on the cloud sector in Spain. The organization seeks to analyze possible elements that may be affecting the competitive functioning of the market, with the aim of issuing recommendations to “promote a competitive environment.”
It is important to note that this initiative by the CNMC is not an isolated case. In the UK, the Competition and Markets Authority (CMA) is conducting a similar analysis and has already proposed preliminary measures to address imbalances and competition issues in the sector.
Implications for the future of the cloud market
The CNMC’s investigation and the statements of different market players highlight the growing importance of cloud services and competitive tensions in an increasingly critical sector for the digital economy. The outcome of this study could have significant implications for the future of the cloud market in Spain and potentially influence regulation at the European level.
Source: La Información