EU tech rules should curb cloud computing providers, study says

© Reuters. FILE PHOTO: The logos of Amazon, Apple, Facebook and Google in a combination photo

By Foo Yun Chee

BRUSSELS (Reuters) – Draft EU rules to curb the power of Amazon (NASDAQ:), Apple (NASDAQ:), Alphabet (NASDAQ:) unit Google and Facebook (NASDAQ:) should also tackle cloud computing services providers over potential anti-competitive practices, a study said on Tuesday.

The report coincides with concerns that some EU lawmakers who are reviewing the Digital Markets Act (DMA) proposed by EU antitrust chief Margrethe Vestager may be lenient towards cloud computing companies.

Amazon’s Amazon Web Services was the leading provider in the second quarter of this year, followed by Microsoft (NASDAQ:) Azure and Google Cloud, market research company Statista found. Others include IBM (NYSE:) Cloud, Alibaba (NYSE:) Cloud, Salesforce and Oracle (NYSE:).

The study was prepared by Frederic Jenny, chairman of the Organisation for Economic Cooperation and Development’s Competition Committee, in his personal capacity for trade body CISPE (Cloud Infrastructure Services Providers in Europe).

“The DMA does say that cloud infrastructure can come within the ambit of the DMA but it is not obvious that all the suppliers are covered, for example it doesn’t seem that Google Cloud qualifies under the DMA as a gatekeeper or IBM Cloud or Salesforce,” Jenny told Reuters in an interview.

He said potential anti-competitive practices by some companies could include unfair pricing techniques or making it technically difficult for users to move to a rival.

Jenny said the study interviewed some 25 companies that use cloud computing services, a number of which cited issues such as unfair licence terms that force customers to pay again to use software they already own when they move to a competitor.

Respondents were also concerned about providers bundling software products with their cloud infrastructure to make rival products either less attractive or more expensive.

Google, Oracle and SAP declined to comment. Microsoft and Amazon did not immediately respond to requests for comment.

EU lawmakers have to thrash out the draft DMA with EU countries before it becomes law, possibly in 2023.

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