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UK Watchdog to Investigate Amazon, Google, and Microsoft's Cloud Businesses

Ofcom, the UK's communications regulator, has announced that it will investigate whether the country's major cloud providers are stifling innovation and growth.

September 22, 2022
3 minutes
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The UK's digital regulator, Ofcom, has announced that it will be launching investigations into digital markets including cloud computing, internet messaging, and smart devices. This marks a further increase in scrutiny of the world's largest tech firms.

Ofcom, the UK's communications regulator, has announced that it will investigate whether the country's major cloud providers are stifling innovation and growth.The regulator, which also oversees broadcasting, telecommunications and the postal service, said it will first look at whether the so-called hyperscale cloud providers, Amazon.com Inc's AWS, Microsoft Corp's Azure, Alphabet Inc's Google Cloud, might be limiting innovation and growth.Ofcom noted that these companies receive about 81% of the revenues in the UK public cloud infrastructure market, which is worth £15 billion ($16.85 billion).

The investigations into the possible dominance of Silicon Valley firms continue to escalate. In June, the Competition and Markets Authority (CMA), Britain's antitrust regulator, launched a separate investigation into the Google Play store over suspected anticompetitive conduct. This follows a similar investigation by the European Commission, which is looking into whether Google has abused its market position by giving preferential treatment to its own products and services.

The independent regulator Ofcom said it will publish a final report within a year on whether the UK's mobile phone market is working properly. If it finds that the market isn't working as it should, it can take the matter to the government, refer antitrust matters to the Competition and Markets Authority (CMA), or take enforcement action itself.

The study on calling and messaging services will examine platforms like Meta Platforms Inc's WhatsApp, Apple Inc.'s FaceTime, and Zoom Video Communications Inc., and explore whether they should be able to interact with each other more.

The purpose of the smart devices investigation is to examine the bargaining power of connected televisions and speakers with content producers such as entertainment and news companies.

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