On June 25, 2026, the European Commission dropped a regulatory bombshell on the cloud computing industry, announcing its preliminary view that Amazon Web Services (AWS) and Microsoft Azure should be designated as gatekeepers under the Digital Markets Act (DMA). If confirmed, the two hyperscale platforms would be compelled to comply with a raft of pro-competition obligations, potentially reshaping how cloud services are sold, integrated, and migrated across Europe.

The Digital Markets Act, which entered into force in November 2022, aims to ensure contestable and fair markets in the digital sector by imposing specific rules on large online platforms that act as "gatekeepers" between businesses and consumers. While the regulation has already designated a handful of tech giants for their roles in search, social media, messaging, and operating systems, this is the first time that cloud infrastructure and platform services have fallen squarely within the DMA's crosshairs.

Gatekeepers are defined under the DMA as companies that have a significant impact on the internal market, offer a core platform service that serves as an important gateway for business users to reach end users, and enjoy an entrenched and durable position. The regulation explicitly lists "cloud computing services" among the core platform services that can trigger a designation. For AWS and Azure, the Commission's preliminary finding signals that they meet the quantitative thresholds: each has a market capitalisation or annual turnover exceeding €7.5 billion, at least 45 million monthly active end users in the EU, or more than 10,000 yearly active business users, and a strong market position expected to endure.

According to market data from Synergy Research Group, AWS and Azure together command more than 55% of the European cloud infrastructure market, with AWS at around 31% and Azure at approximately 24%. Google Cloud, the next largest rival, holds about 10%. This concentrated market power, combined with technical and commercial practices that allegedly make it difficult for customers to switch providers or use multiple vendors, forms the backbone of the Commission's case.

"After an in-depth investigation, we have preliminarily concluded that AWS and Microsoft Azure are important gateways for businesses to access cloud services in the EU," the Commission stated in its press release. "Their dominant positions and certain practices may harm competition, limiting innovation and customer choice. Our objective is to ensure that European businesses of all sizes can freely choose the best-fit cloud solutions without being locked into a single ecosystem."

The preliminary finding triggers a nine-month period during which the Commission will conduct a more detailed investigation, gather feedback from interested parties, and allow AWS and Microsoft to present their arguments. A final decision is expected no later than early 2027. Designated gatekeepers must then comply with the DMA's obligations within six months.

If confirmed, the obligations for AWS and Azure would be extensive. Key requirements would likely include:

  • Data portability and interoperability: Cloud providers must offer tools and interfaces to enable business users to easily export their data and workloads to alternative platforms without technical hindrance or excessive cost. This could mean standardised APIs, open-source migration utilities, and transparent data formats.
  • Prohibition of self-preferencing: The platforms would be barred from ranking their own services more favourably than those of third parties when presenting options to customers. For instance, AWS could not give preferential treatment to its own database services over competing databases from partners like Oracle or MongoDB in its marketplace.
  • No tying or bundling that locks users: Gatekeepers cannot require business users to use their proprietary identity management, analytics, or other ancillary services as a condition for obtaining the core cloud service.
  • Transparency on pricing and contractual terms: The platforms would need to provide clear, comparable pricing information and avoid opaque discount schemes that penalise multi-cloud strategies.
  • Fair access for business users: Developers and SaaS companies that rely on the cloud infrastructure to deliver their own services must be treated without discrimination.
  • Interoperability of ancillary services: Gatekeepers may be required to allow business users to integrate third-party security, monitoring, or management tools seamlessly.

The DMA also empowers the Commission to impose structural remedies in extreme cases of systematic non-compliance, including potentially breaking up parts of a gatekeeper's business. While such drastic measures are unlikely for AWS and Azure at this stage, the possibility underscores the seriousness of the regulation.

Both Amazon and Microsoft reacted swiftly to the announcement. In a statement, AWS argued that the cloud market is highly competitive and that customers already have multiple tools for migration. "We disagree with the Commission's preliminary view and will engage constructively to demonstrate the vibrant choice and dynamic innovation in the cloud industry," an AWS spokesperson said. "Cloud services are not gateways but enablers of digital transformation, and any heavy-handed regulation risks stifling the very innovation that European businesses rely on."

Microsoft similarly pushed back, noting its long history of compliance with European regulations and its commitment to openness. "Azure provides robust data portability solutions and supports open-source standards," the company said. "We believe the cloud market is characterised by strong competition from Google, Alibaba, and local European providers. Imposing DMA obligations on just two players ignores the broader reality and could distort competition."

However, critics and competitors have long complained about vendor lock-in and anti-competitive behaviour. Smaller European cloud providers, such as OVHcloud, Deutsche Telekom’s T-Systems, and Scaleway, have consistently called for regulatory intervention, arguing that AWS and Azure leverage their scale to impose proprietary technologies and egress fees that trap customers. The European Commission's announcement was welcomed by the European Alliance for Industrial Data, Edge and Cloud, an industry group that has been advocating for stronger competition safeguards.

The potential designation also raises questions about the global reach of the DMA. As with previous gatekeeper designations, the obligations would apply only to the European footprint of the companies, but the compliance measures could have spillover effects worldwide. AWS and Azure may decide to implement changes globally to maintain a unified platform, or they might create regional-specific versions, potentially fragmenting the cloud ecosystem. This could increase operational costs for multinational enterprises.

For businesses that rely heavily on AWS or Azure, the move promises greater flexibility but also uncertainty. "If the DMA opens up truly seamless migration, we might see more companies adopting multi-cloud strategies to avoid dependency," said Janine Müller, an analyst at a technology research firm based in Berlin. "But the transition period could be messy. New compliance tools might need to be built, and pricing models could shift."

Some experts caution that the regulation could also have unintended consequences. Overly prescriptive portability requirements, for example, could force cloud providers to homogenise their services, reducing the incentive to develop differentiated, cutting-edge features. There is also the risk that compliance costs are passed on to customers. The DMA, however, includes flexibility for the Commission to tailor obligations to the specific context of each gatekeeper, which could mitigate such risks.

The preliminary finding comes amid a broader global push to rein in the power of big tech. The United States has increasingly scrutinised cloud market concentration through the Federal Trade Commission, and the United Kingdom's Competition and Markets Authority has opened its own inquiry into cloud services. The DMA, however, remains the most far-reaching regulatory framework, and its application to cloud computing sets a precedent that other jurisdictions may follow.

A particularly important aspect for Windows users and Microsoft's broader ecosystem is how the DMA might force the unbundling of Azure from other Microsoft products. Currently, businesses that adopt Microsoft 365 and Windows Enterprise often find themselves steered towards Azure for identity management (Azure Active Directory), virtual desktops (Azure Virtual Desktop), and other services. The Commission could require that Microsoft offer interoperability with third-party cloud directories, or ensure that Windows licenses do not discriminate against using alternative cloud providers. Such moves could fundamentally alter the way enterprise IT environments are designed and managed.

Looking ahead, the Commission will now navigate a delicate period of negotiation with Amazon and Microsoft. The companies can challenge the designation in the General Court of the European Union, which could delay enforcement but is unlikely to overturn the principle of gatekeeping if the Commission's factual basis is solid. The more critical battle may be over the specifics of the compliance measures — what exactly "effective interoperability" means for a cloud platform, or how to measure non-discrimination in a complex service ecosystem.

The final outcome will depend on deep technical dialogues between engineers, lawyers, and policymakers. For now, the cloud industry watches as two of its giants face a regulatory reckoning that could redefine competition in the digital age. European businesses, long frustrated by the grip of the hyperscalers, may soon see a more open and fluid cloud market — if the regulators can strike the right balance.