The Competition and Markets Authority announced a probe into Microsoft on March 31, 2026. The regulator will examine licensing policies that may restrict cloud competition significantly. This move targets unfair advantages for the Azure platform over rival services in the United Kingdom.
Officials stated that Microsoft and Amazon set out actions regarding data egress fees. These fees previously stifled competition in the final decision on the cloud investigation. The watchdog refrained from designating strategic market status for now. The agency says further steps are required to help customers adopt multi-cloud strategies effectively.
Key Details
Microsoft claims it removed barriers globally with the Azure Arc tool. The company will offer free egress for UK customers migrating to rivals. This free period extends from 60 days to 180 days for data transfers. Redmond is also expanding the definition of a qualifying switch for exit from individual Azure services.
Amazon unveiled AWS Interconnect multicloud last November. Customers can transfer data via private connections at a flat price. The provider also supports interoperability protocols for AI tools. It promises a free tier will be available once it reaches general availability.
Concerns center on products like Windows Server and SQL Server. Costs rise significantly when running these on non-Microsoft clouds. Google estimated legacy workloads cost five times more elsewhere. Microsoft permits customers to reallocate on-prem licenses to cover cloud-based instances running on Azure.
"We are taking action now," said CMA chief executive Sarah Cardell. She warned dominance could replicate in emerging AI markets. The regulator seeks to ensure a level playing field for business tools.
Industry Response
Industry reactions remain mixed across the sector. The Computer and Communications Industry Association welcomed the decision. They noted avoiding overly broad interventions would protect investment. Mark Boost of cloud provider Civo expressed disappointment with the exclusions.
He argued excluding AWS creates a regulatory imbalance between parties. Domestic innovation needs a fair digital market environment. Nicky Stewart of the Open Cloud Coalition urged swift action should commitments fail. She stated that unfair software licensing practices have broken the cloud market.
Future Outlook
The strategic market status investigation starts in May. It could take up to nine months to complete fully. The agency will issue an invitation to comment soon. The CMA board will review progress in six months.
Future implications involve how AI embeds into software tools. Observers will watch for compliance on egress commitments. The regulator will impose rules designed to promote competition if status is designated later.
