UK Watchdog Demands More Cloud Portability From AWS and Microsoft
The Competition and Markets Authority says major cloud providers have improved switching tools but still face new regulatory hurdles.
Key points
- The CMA proposes bringing Microsoft under its strictest digital market rules for business software.
- Amazon Web Services and Microsoft must improve cross-cloud login management and data portability.
- Both companies have removed data transfer fees and built direct interconnections with rivals.
The UK Competition and Markets Authority reported on Friday that Amazon Web Services and Microsoft must take further steps to simplify cloud switching. The regulator stated that while the two tech giants have implemented some improvements, significant barriers to moving between providers remain. This assessment marks the first progress check since March, when the CMA accepted voluntary commitments from the companies to avoid a formal investigation into the cloud market. The watchdog had previously indicated it would review their progress after six months.
Since March, both AWS and Microsoft have connected their data centers directly to those of competitors, starting with Google. They have also eliminated fees for customers who migrate their data to another cloud provider. Additionally, both firms now allow customers and rivals to request better service links and offer artificial intelligence tools designed to assist with migration processes. The CMA noted these changes but insisted that more work is required to ensure true competition.
Regulatory Next Steps
The regulator now wants both firms to simplify the management of user logins and access rights across different cloud environments. It also seeks systems that can move between providers without creating extra operational hurdles. The CMA plans to issue another update in spring 2027. It has not ruled out launching a full cloud investigation under its new powers if the companies fail to meet expectations. The agency will now gather views on its proposal and expects to reach a final decision by February 2027.
Microsoft Under Scrutiny
In a separate development, the CMA proposed giving Microsoft strategic market status in the business software sector. This follows an investigation opened in May. If approved, Microsoft would become the third company, after Google and Apple, to fall under Britain’s new digital markets regime. The proposal covers Windows, Office, security tools, server software, and databases. The CMA intends to examine how Microsoft licenses its software to rival cloud providers and whether customers can freely choose AI tools other than Copilot.
Sarah Cardell, the CMA’s chief executive, stated that organizations should be able to select the products that work best for them. Microsoft said it does not share the CMA’s view, asserting that all its products, including Copilot, are open and interoperable. The company welcomed the finding that its cloud position does not warrant a designation. AWS also welcomed the update, noting it has continued investing in AI and cross-cloud tools this year.
What should you do?
Organizations relying on major cloud providers should review their current data portability and migration strategies. IT leaders need to assess whether their current contracts allow for seamless switching without hidden costs or technical barriers. Security teams should verify that user access management systems can function across different cloud environments. Monitoring regulatory updates from the CMA will help organizations anticipate changes in vendor compliance requirements.
What to do and how to stay safe: AWS
- Audit current cloud contracts for data egress fees and technical migration barriers.
- Test cross-cloud identity management tools to ensure seamless user access.
- Monitor CMA announcements for changes in strategic market status designations.
- Evaluate vendor lock-in risks by documenting dependencies on proprietary services.
Step-by-step guide: Mobile Device Security: How to Protect Data Beyond Passwords
General security guidance from the Threat Times newsroom. It is not confirmed advice from the organisations named in this story.
Frequently asked questions
What specific improvements did AWS and Microsoft make since March?
They connected data centers directly with rivals like Google, removed data transfer fees, and introduced AI tools to help with migration.
What new regulatory status is proposed for Microsoft?
The CMA proposed giving Microsoft strategic market status in business software, which would bring it under Britain’s new digital markets regime.
When will the CMA issue its next update on cloud portability?
The regulator plans to issue another update in spring 2027 and expects a final decision on Microsoft by February 2027.
