EU targets Amazon and Microsoft cloud services under new Digital Markets Act rules

Amazon Web Services and Microsoft Azure are on track to become the first cloud providers designated as gatekeepers under Europe's Digital Markets Act, a move that would extend the bloc's strict antitrust regime to cloud infrastructure for the first time.

The European Commission told both companies Thursday that their cloud services meet the criteria for DMA regulation, even though neither AWS nor Azure hits the law's quantitative thresholds. The Commission justified the designation by arguing that both services function as "crucial" gateways between businesses and consumers, citing their size, market power, and what it described as "lock-in effects" and "high switching costs" for customers.

The preliminary finding marks the first time the EU has targeted cloud providers under the DMA, which previously applied to platforms like Google Search, the Apple App Store, and Meta's social networks. The Commission opened its investigation into AWS and Azure last November and must reach a final decision within 12 months, meaning a binding ruling is expected by November.

Tech Commissioner Henna Virkkunen said cloud services "have become a cornerstone of Europe's economy, and a prerequisite for AI," noting that more than half of European businesses now rely on them. The Commission also pointed to AWS and Azure's AI tools and partnerships as decisive factors in the cloud procurement market, arguing that AI is accelerating demand for cloud services and reinforcing both companies' dominance.

AWS is the largest cloud provider in Europe; Azure is the second-largest. The Commission found that both companies' operational capacity and investments "significantly outpaced those of competitors."

Both companies can contest the preliminary designation. A Microsoft spokesperson said the company continues to engage with the Commission, adding that "the cloud sector in Europe is , highly competitive and an accelerator for growth across the economy." Microsoft also warned that ignoring Google Cloud's growing power "will tilt the market in a harmful way."

An AWS spokesperson said the company faces "healthy competition" and that customers across Europe have "more choice, lower prices, and greater flexibility than ever before." AWS criticized the designation, arguing the bloc "already has cloud regulation."

A final decision from the Commission is expected this November. If the designation holds, AWS and Azure would be subject to the same DMA obligations as other gatekeepers, including bans on self-preferencing, data portability requirements, and interoperability mandates that could fundamentally reshape how cloud services are sold and delivered in Europe.