As Brussels investigates their market dominance, Amazon and Microsoft cloud services may be subject to more stringent EU competition laws, the bloc's tech chief warned. Henna Virkkunen stated at a summit in Berlin centered on the drive for increased European digital sovereignty that the twin investigations are intended to determine whether the tech giants "should be designated as the gatekeepers on cloud computing."

Amazon Web Services (AWS) and Microsoft Azure "act as important gateways between businesses and consumers, despite not meeting the DMA gatekeeper thresholds for size, user number, and market position," according to the European Commission, the bloc's digital regulator.

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It will look into whether these services should fall under the purview of the Digital Markets Act (DMA). It also stated that the commission will try to wrap up the investigations in a year.

To determine whether the DMA needs to be updated to ensure that it "can effectively tackle practices that may limit competitiveness and fairness in the cloud computing sector in the EU.

Brussels also declared that it would launch a third investigation. With a list of dos and don'ts for Big Tech, the DMA is a component of the European Union's strengthened legal arsenal that aims to make the digital sphere more equitable.

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For instance, tech giants are required to provide users with "choice screens" that allow them to select between various web browsers and search engines.

According to the law, fines of up to 10 percent of a company's total global turnover may be imposed by the EU. Due to the dominance of US cloud providers, who control about two thirds of the market share in the 27-nation bloc, Brussels had been under pressure to include the investigated services under the bill's purview.

AWS is the market leader in cloud computing, closely followed by Microsoft Azure and Google Cloud. The government is not looking into Google.

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Since a significant amount of their business is conducted through enterprise contracts, the major cloud providers—mostly from the US—have so far managed to avoid the EU's Digital Markets Act.

According to reports, this makes figuring out the number of individual users challenging. Nonetheless, this is one of the most crucial factors used by the EU to assess a company's market power.

The goal of the Digital Markets Act (DMA), which went into effect in November 2022, is to improve competition by limiting the market dominance of "gatekeepers" like Google, Amazon, and Apple. The EU regulation defines gatekeepers as businesses that provide central platform services and have a long-term, substantial impact on the EU's internal market.