The update comes six months after Ofcom proposed to make this referral. The regulator has said its market study has identified features that make it “difficult for UK businesses to switch and use multiple cloud suppliers”.
Ofcom has found that, while competitive market forces are delivering benefits to customers, it is concerned about egress fees, technical barriers to interoperability and portability, and committed spend discounts.
Fergal Farragher, Ofcom’s director responsible for the cloud market study, explained, “The cloud is the foundation of our digital economy and has transformed the way companies run and grow their businesses. From TV production and telecoms networks to AI innovations – all of these things rely on remote computer power that goes unseen.
“Some UK businesses have told us they’re concerned about it being too difficult to switch or mix and match cloud provider, and it’s not clear that competition is working well. So, we’re referring the market to the CMA for further scrutiny, to make sure business customers continue to benefit from cloud services.”