EU targets Microsoft, Amazon cloud in 7-month DMA gatekeeper probe

The European Commission's preliminary findings threaten to reshape the $953 billion global cloud computing market.

The European Commission on Thursday said Microsoft Azure and Amazon Web Services should be designated gatekeepers under the Digital Markets Act, escalating a 7-month antitrust probe into the world's two largest cloud providers.

"The preliminary findings follow a thorough investigation and aim to ensure contestable and fair markets in the cloud sector," the European Commission said in a statement. "AWS and Microsoft Azure meet the thresholds for designation as gatekeepers under the Digital Markets Act."

The probe, launched seven months ago, targets the two dominant players in a global cloud market projected to reach $953 billion by 2035, according to industry estimates. Amazon Web Services and Microsoft Azure together control more than half of the worldwide cloud infrastructure market, with Alphabet Inc.'s Google Cloud trailing as a distant third.

A gatekeeper designation under the DMA would force Microsoft and Amazon to comply with a strict set of dos and don'ts — including bans on self-preferencing, data siloing, and anti-competitive bundling — or face fines of as much as 10% of global annual revenue. For Microsoft, whose Azure revenue reached $105 billion in fiscal 2025, and Amazon, whose AWS unit generated $107 billion in 2025, the financial exposure could run into the tens of billions.

The preliminary findings, announced by EU antitrust regulators on Thursday, mark the first time the bloc has targeted cloud infrastructure services under the DMA, which took full effect in March 2024. Since then, the commission has designated six gatekeepers across core platform services including online search, social media, and app stores — but cloud computing had remained outside the scope until now.

Google's Shadow Looms Over the Probe

Microsoft pushed back against the findings by pointing to Google Cloud's growing market presence, arguing that singling out Azure and AWS would ignore a key competitor. "We remain concerned that ignoring the growing power of Google Cloud and Gemini will tilt the market in a harmful way," a Microsoft spokesperson said. Amazon echoed the concern, saying the preliminary assessment "disregards the breadth of cloud services available to European customers and risks deterring European investment and innovation."

Google Cloud held roughly 11% of the global cloud infrastructure market in 2025, compared with Azure's 24% and AWS's 32%, according to Synergy Research Group data. While Google's share has grown steadily — up from 7% in 2020 — it remains well behind the two leaders, making the case for tripartite designation a central point of contention.

What a Gatekeeper Designation Means

If finalized, the designation would require Microsoft and Amazon to allow third-party cloud services to interoperate with their platforms, prohibit them from using non-public business data to compete, and ban practices that lock customers into their ecosystems. The DMA's penalty structure — fines of up to 10% of global annual revenue and up to 20% for repeat offenders — creates a powerful enforcement mechanism.

The European cloud market, valued at roughly $85 billion in 2025, has been a focus of EU digital sovereignty efforts. The commission's push to regulate cloud infrastructure aligns with broader European ambitions to reduce reliance on US technology providers, a theme that has gained urgency as transatlantic tensions over semiconductor export controls and data governance have escalated.

For investors, the regulatory overhang adds a new layer of uncertainty to two of the world's most valuable companies. Microsoft shares have gained 18% over the past 12 months, while Amazon has risen 22%, partly driven by cloud revenue growth. A DMA designation could force operational changes that compress margins in their highest-growth divisions.

The commission will now accept responses from Microsoft and Amazon before issuing a final decision, expected within the next six months. If the preliminary findings are confirmed, the companies would have six months to comply with the DMA's requirements.

This article is for informational purposes only and does not constitute investment advice.