By Foo Yun Chee
BRUSSELS (Reuters) – Cloud computing, in which Amazon and Microsoft are the biggest players followed by Alphabet’s Google, doesn’t pose competition concerns yet because of Europe’s Gaia-X initiative, EU antitrust chief Margrethe Vestager said on Monday.
Cloud computing services have seen demand soar, driven in part by the COVID-19 pandemic.
They have become a big driver of growth at the big tech companies, with AWS generating 13% of Amazon’s revenue last year and 74% of its operating income while Microsoft’s Intelligent Cloud unit, of which Azure is a big chunk, brought in 37% of its overall sales.
The market power of the big companies has sparked unease at smaller rivals in recent years, with German software provider NextCloud, France’s OVHcloud and two other companies filing complaints about Microsoft’s cloud practices to Vestager.
“No, so far we’ve had no concerns,” Vestager told Reuters in an interview when asked if she was worried about companies potentially abusing their dominance.
She said Gaia-X, a project to create secure and efficient cloud data that seeks to reduce the EU bloc’s dependence on Silicon Valley giants, would boost competition.
“This is not something that we are engaged in, but I basically see it as pro-competitive when you have someone to show potential customers that there are more than two giants where you can place your business,” she said.
An industry study last year cited respondents worried about unfair terms imposed by some software companies to access their cloud infrastructure, unfair licence terms and bundling of software products with cloud infrastructure services.
Microsoft has said that it makes its software available to customers across all environments, including those of other cloud providers.
(Reporting by Foo Yun Chee; Editing by Nick Macfie)
