EU Investigates Dominance of US Cloud Providers Under Digital Markets Act
The European Union is set to scrutinize the influence of leading American cloud service providers, including Amazon Web Services, Microsoft Azure, and Google Cloud, under the framework of the Digital Markets Act (DMA). This regulatory move follows recent high-profile outages that disrupted critical online services globally, highlighting the risks of dependency on a small group of major cloud vendors.
Competition authorities in the EU have signaled their intent to evaluate whether these dominant platforms should face additional regulatory requirements. In recent months, the cloud sector has experienced several notable disruptions. A major incident involved a 15-hour outage at a primary AWS data center in the United States, which affected hundreds of companies and rendered services such as Atlassian, Docker, and various streaming platforms temporarily inaccessible. Shortly thereafter, Microsoft Azure users encountered a separate outage that disrupted airline check-ins and delayed parliamentary proceedings in Scotland. In another incident, Google Cloud and Cloudflare users in the US also faced service interruptions impacting multiple online applications.
Until now, major cloud providers have largely avoided the direct scope of the DMA, as their business models primarily revolve around enterprise agreements, making it challenging for regulators to assess user numbers--a key metric for determining market power under EU law. The DMA, which came into effect in November 2022, aims to limit the dominance of so-called gatekeeper companies--entities that operate essential platform services with significant and sustained influence over the European market.
Under the proposed investigation, EU regulators are expected to consider whether leading cloud providers should be subject to enhanced requirements regarding interoperability and data portability. These measures would be designed to foster a more competitive landscape by making it easier for customers to switch providers and avoid lock-in effects. Should authorities find that these platforms have violated existing regulations, they could face substantial financial penalties.
While companies such as Apple and Meta have already incurred significant fines for breaching the DMA, the focus on cloud services marks a new phase in the EU's broader effort to promote fair competition and reduce systemic risks in the digital economy. The reliance on only a few large-scale providers has raised concerns among European regulators, especially as outages can have far-reaching implications for businesses, public services, and end users across the continent.
The examination is expected to review how these cloud platforms manage data, ensure service continuity, and maintain compliance with data protection and competition rules. In particular, the investigation will address whether additional safeguards are necessary to guarantee interoperability between different cloud environments and to facilitate the free movement of data between providers.
The outcome of the EU's inquiry could reshape operational requirements for global cloud service providers operating within the European market. The authorities aim to enhance digital resilience and competitiveness while ensuring that customers benefit from greater choice and transparency when selecting cloud solutions.
As the digital infrastructure of businesses and public institutions grows increasingly dependent on cloud services, the EU's regulatory approach underscores the importance of robust oversight to mitigate risks and maintain a fair digital marketplace. The findings of this investigation are likely to influence not only regulatory policy in Europe but also the strategic direction of the global cloud computing industry.