The European Commission has reached a preliminary conclusion that could reshape how Europe’s two biggest cloud providers operate: Microsoft Azure and Amazon Web Services may soon get labeled as gatekeepers under the Digital Markets Act, a designation that carries serious teeth.
Neither company technically hit the usual quantitative thresholds the DMA relies on, things like raw user counts, but the Commission decided their market position warranted scrutiny anyway. Regulators described AWS and Azure as the largest and second-largest cloud providers in the EU, arguing that both benefit from deeply entrenched customer bases, lock-in effects, and switching costs steep enough to function as a gateway between businesses and their own customers.
If the designation sticks, Microsoft and Amazon would face new obligations around interoperability, data access, and competition, backed by fines reaching up to 10 percent of global turnover for noncompliance. That’s not a number either company can shrug off.
Both pushed back quickly. A Microsoft spokesperson told The Register the company is “continuing to engage constructively” with regulators, while raising a pointed counterargument: ignoring Google Cloud‘s growing presence in the market, especially alongside Gemini, risks tilting competition in the wrong direction entirely. AWS took a similar line, arguing that European customers already enjoy plenty of choice and that piling DMA obligations on top of existing cloud regulation under the EU’s Data Act risks discouraging investment rather than protecting it.
Not everyone agrees with that framing. The Open Cloud Coalition, a group Microsoft has previously dismissed as a Google-aligned lobbying effort, welcomed the preliminary finding and pushed for quick remedies, particularly around concerns that existing lock-in could end up fueling dominance in enterprise AI as well.
Henna Virkkunen, the Commission’s executive vice-president overseeing tech sovereignty, framed the stakes in broader terms, noting that more than half of EU businesses now depend on cloud infrastructure, making fair and open competition essential to Europe’s digital future.
Nothing is final yet. Microsoft and Amazon get a chance to respond before any designation becomes official, and if it does, they’ll have six months to comply.
