CMA says UK cloud market is uncompetitiveAWS and Microsoft account for 30-40% of the UK market eachThe two companies disagree with the CMA's findingsThe UK's Competition and Markets Authority (CMA) has determined Britain's cloud market shows too many anticompetitive traits, with Microsoft and AWS each holding around 30-40% of the UK market in 2024 and hyperscaler concentration especially high in infrastructure-as-a-service.At the same time, fewer than 1% of customers switch providers annually and multicloud usage is rare (particularly among SMEs with more limited budgets).The CMA has blamed high egress fees, incompatible interfaces, latency and skills gaps for widespread vendor lock-in, which is ultimately weakening competition.CMA worried about AWS and Microsoft cloud market dominanceBehind the two hyperscalers, Google accounts for just 5-10% of the market, with others like IBM and Oracle having even smaller shares. Although AI capabilities are yet to change market dynamics drastically, existing positions are likely to be amplified, thus the CMA has stepped in to ensure competition remains healthy.In its Final Decision ruling, the CMA took the biggest hits at Microsoft over its unfair licensing practices, which make it costlier to run Microsoft software on rival cloud providers.A Microsoft spokesperson told TechRadar Pro: "The CMA Panel’s most recent publication misses the mark again, ignoring that the cloud market has never been so dynamic and competitive, with record investment, and rapid, AI-driven changes. Its recommendations fail to cover Google, one of the fastest-growing cloud market participants.""Microsoft looks forward to working with the Digital Markets Unit toward an outcome that more accurately reflects the current competition in cloud that benefits UK customers," they continued."The action proposed by the Inquiry Group is unwarranted and undermines the substantial investment and innovation that have already benefited hundreds of thousands of UK businesses," an AWS spokesperson added.On the flip side, Google supported the CMA's findings: "The conclusive finding that restrictive licensing harms cloud customers and competition is a watershed moment for the UK."Elsewhere in the industry, the CMA has been criticized for not acting fast enough and addressing persistent issues like cloud credits, lock-in and procurement bias."We urge the CMA to use the powers at its disposal now to address these harms, rather than embark upon a new investigation that may not give customers relief for years to come," Coalition for Fair Software Licensing Executive Director Ryan Triplette shared.Looking ahead, the CMA's next step is to designate Microsoft and AWS with strategic market status (SMS) under the Digital Markets, Competition and Consumers (DMCC) Act, allowing it to impose legally binding, targeted conduct requirements on the two giants."A significant driver of high cloud computing bills is the consolidation of the market into a handful of players. Until recently, these companies have been the only game in town, so they’ve been able to set the rules of the market, for example, including egress fees for switching, long lock-in periods, and more. In fact, Gartner has observed that most customers spend 10% to 15% of their cloud bill on egress charges," noted Akamai's John Bradshaw."UK businesses are under huge cost pressures. We need to make it easier for them to switch cloud computing providers and find pricing options that better fit their balance sheets."You might also likeThese are the best cloud hosting providersWe've listed the best cloud storage and best cloud backup platformsMicrosoft hits back against UK competition lawsuits, slams AWS and Google once again