2 min

Europe’s Gaia-X program balances the cloud computing market. Amazon and Microsoft dominate the cloud market, trailed by Alphabet’s Google, but it does not currently cause competition worries, according to EU antitrust boss Margrethe Vestager.

Demand for cloud computing services has risen dramatically due to the COVID-19 pandemic. They’ve become a significant engine of growth for the large IT giants, with AWS accounting for 13% of Amazon’s revenue and 74% of its operating income in 2021, and Microsoft’s Intelligent Cloud segment, which includes Azure, accounting for 37% of the company’s total revenue.

Gaia-X presents a viable solution for Vestager

In recent years, smaller players have expressed concern about giant corporations’ market strength, with German software supplier NextCloud, France’s OVHcloud, and two other businesses submitting protests with Vestager over Microsoft’s cloud policies.

Vestager said in an interview with Reuters when asked if she was concerned about corporations abusing their market power, “No, so far, we’ve had no concerns.”

Vestager said that Gaia-X, a project to generate efficient and safe cloud data to reduce the EU bloc’s reliance on Silicon Valley behemoths, will boost competition. 

Relevant parties still have concerns

Vestager said that this isn’t something the anticompetition agency is involved in. However, she added that she thinks it’s pro-competition when there’s an alternative to show prospective customers that their choices are not limited to two dominant players. 

Respondents in a recent industry survey expressed concern about unreasonable conditions imposed by some software businesses for access to their cloud platform, unfair license terms, and software product bundling with cloud-based services. 

According to Microsoft, its software is available to consumers in all settings, including those provided by competing cloud providers.