The European Commission has decided that Microsoft Azure and Amazon Web Services should face strict rules to improve cloud competition. The move risks angering Washington as Brussels pushes the European tech sovereignty agenda.
The European Commission said on Thursday that Microsoft and Amazon's cloud services should fall under a strict regulatory regime, at least on a preliminary basis, as Brussels tries to make the cloud market fair and contestable while promoting European providers.
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The decision means Microsoft Azure and Amazon Web Services – the two largest cloud service providers, accounting for roughly 60 percent of the European market – should be subject to the obligations and prohibitions of the Digital Markets Act (DMA), the law designed to curb anti-competitive practices by dominant companies.
Notably absent from the Commission's scrutiny is the sector's third major player, Google Cloud, which is not yet considered to hold the level of market dominance needed to be captured under DMA rules.
"We remain concerned that ignoring the growing power of Google Cloud and Gemini will tilt the market in a harmful way," a Microsoft spokesperson told Euronews.
The EU rulebook is designed to stop tech giants from trapping clients in their services by making switching to a competitor either prohibitively expensive or technically impossible.
The move risks drawing Washington's ire, as the Trump administration has been vocal in defending American companies it believes are being treated unfairly in Europe precisely because they are successful. But Brussels insists the move is not about transatlantic competition per se.
"This is not about European players versus US players," Ricardo Cardoso, the Commission's spokesperson for competition policy, said at a press conference following the announcement.
The Commission and the US government have been setting up a digital dialogue, which Brussels sees as a venue to explain its regulatory choices and pre-empt public criticism from across the Atlantic. Critics counter that the format instead gives Washington a privileged platform to lobby against EU rules. Either way, the first meeting of the dialogue has yet to take place.
The decision comes just weeks after the Commission unveiled plans to reduce its dependency on foreign technology providers in favour of domestic alternatives – with cloud services among the sectors most affected.
The push to make the US-dominated cloud market more competitive thus lands just as Brussels advances rules that would reserve some of the bloc's most sensitive public contracts for European providers.
Whether these combined measures will reduce Europe's dependency on foreign technology – and how much they will escalate transatlantic tensions – remains an open question.