Overview
On March 31 2026, the CMA stepped back from opening a strategic market status (SMS) investigation under the UK's new Digital Markets Competition Regime (DMCR) into cloud services, instead accepting voluntary commitments from Amazon Web Services and Microsoft Azure to make certain changes to their business practices, including lowering egress (exit) fees, making it easier to switch and improving interoperability with other cloud operators.
Such an approach augurs well for future engagement as the CMA pivots from ball-breaker to deal-maker and follows decisions in other CMA investigations (including of Apple and Google in app stores) to accept voluntary commitments in place of formal conduct requirements (CRs). Even still, the settlement in cloud is exceptional, occurring even before an SMS investigation was launched. This demonstrates a degree of pragmatism on the part of the CMA (and good faith engagement by the companies concerned) to offer reasonable adjustments to allay concerns. It is also entirely in the spirit of a new regime intended to be a more flexible cousin to the EU's Digital Markets Act and allow for precisely these types of bespoke outcomes.
However, the decision to open another SMS investigation into a narrow subset of its concerns in cloud bucks this trend. Given the significant resource constraints the CMA is experiencing in its other functions (including antitrust and cartels, where they have lost between 20-30% of staff) and the clear availability of a route to address concerns in productivity software through negotiation, as they have just done in cloud, the decision to re-commit the Digital Markets Unit (DMU) staff to a cloud-lite SMS investigation rather than re-deploy them elsewhere in the agency is a missed opportunity to rebalance the CMA's work structurally (as well as optically).
The beginning of the end …
This decision represents some closure for issues in the UK cloud infrastructure market first investigated back in 2022 by the UK Office for Communications (Ofcom). Concerns identified by Ofcom in that market study were then taken up by the CMA using its market investigation reference (MIR) powers in 2023 and led to full-scale MIR investigation lasting two years, which focused on (i) processing, storage, networking and other raw cloud computing resources (referred to as 'infrastructure-as-a-service', or IaaS) and (ii) services that can be used to develop, test, run and manage applications on the cloud (known as Platform Services).
The cloud MIR Inquiry Group reported in July 2025 and identified concerns in data egress fees, technical and contractual interoperability and software licensing. Critically, no remedies were proposed under the markets regime; instead, the Group recommended that the CMA open another SMS investigation into the cloud market under the CMA's new DMCR powers. In the months that followed, it appeared that the CMA was taking all steps to do precisely that.
However, following engagement with Amazon and Microsoft, it has now demurred from doing so. In return, those companies have agreed to take action in regard to cloud egress fees and interoperability, directed at businesses and public sector organizations in the UK, to reduce the expense and friction of using more than one cloud provider. Microsoft said the changes to its Azure cloud services would allow UK customers to "move, deploy, and operate their workloads in the clouds of their choice with confidence, flexibility, and ever-reduced friction." The CMA will review efforts to support multi-homing and switching in six months' time.
… or the end of the beginning?
One area of concern identified by the MIR, which was not specifically addressed in the voluntary commitments, was software licensing practices. The CMA has signaled that it intends to address these by opening an SMS investigation after all, but only Microsoft and its productivity software (e.g., Microsoft365) will be covered. This investigation is expected to launch in May 2026.
Wash, rinse, repeat?
Ultimately, the decision to accept commitments in cloud services is entirely in keeping with the recent trend by the CMA to pursue proportionate and negotiated outcomes under the 4P framework (and its specific application to the DMCR regime). Cloud, unlike other markets, is not characterized by a sole monopoly supplier. While AWS and Azure have significant market shares, other major players are also active (including Alibaba, Google, IBM and Oracle) and the IaaS layer sits in a stack that also includes major chipset manufacturers such as AMD, Intel and Nvidia, as well as those developing AI foundation models, including Anthropic, Gemini, Llama, Mistral and OpenAI. The complexity and interrelatedness of this market makes stark intervention in just one area risky, another reason why this outcome makes sense.
However, one has to question the logic of now proceeding to open an SMS investigation specifically into productivity software, where the issues are – like in egress fees and interoperability – already well trailed in the Cloud MIR (e.g. making it easier to bring your software subscription to another cloud provider). Given that the CMA has sought to use SMS designation and the threat of CRs to agree voluntary commitments (as in Apple and Google in app stores), and now the threat of SMS designation as leverage to agree commitments (as in AWS and Azure in cloud), why not do the same with productivity software?
Is another 12-18 month investigation really proportionate, or necessary, when other areas of the CMA are starved of staff?
This latest decision feels less like a well thought out strategy and more like a need to repurpose those DMU staff that were prepared to open an SMS investigation into cloud and now stand idle pending the next SMS investigation. That is hardly a good reason to proceed; in particular, where the roadmap for agreeing commitments is laid out and stress-tested. At a time when the CMA has lost between 20-30% of its workforce across antitrust, cartels and consumer protection, it should give serious consideration to re-purposing some DMU staff (hitherto ring-fenced from cuts elsewhere) and seek to establish a more balanced approach that is less digital-focused, not only optically, but structurally.
