Ofcom, the broadcast and telecoms regulator in the UK, is launching an investigation to look into cloud services being offered by tech giants in the coming weeks to ensure there is healthy competition in the space. Furthermore, the regulator has revealed that it will examine messaging and video calling services as well as smart and connected devices in the near future. For its cloud research, Ofcom’s market research will focus on the largest cloud providers in the region, namely Amazon Web Services (AWS), Microsoft and Google.
The three providers generate 81 per cent of revenue in the UK’s £15 billion (US$16.95) cloud infrastructure services market. Ofcom’s study will assess how well the market is doing with these tech giants dominating the space. It will also examine the strength of the competition and whether the market, in its current state, makes it difficult for other players to enter and expand their share.
Ofcom explains that it is trying to root out any potential competition issues to prevent them from becoming a big problem as the market for cloud services matures. After all, the lack of healthy competition could stifle growth and innovation and lead to poor service quality. If the regulator determines that the market is not working well, it can recommend regulatory changes to the government, take enforcement action itself, or refer the situation to the Competition and Markets Authority (CMA). Of note, the CMA has a separate and ongoing investigation into Google’s ad technology practices.
The regulator will also launch investigations to investigate other digital markets over the next year. You will assess the impact of messaging and video calling services, such as WhatsApp, FaceTime, and Zoom, on traditional calling and messaging methods. Ofcom aims to determine how competition in this area could evolve in the coming years and whether the lack of cross-messaging and cross-calling capabilities between the services is a cause for concern.
The agency also intends to investigate competition in the smart TV and speaker space. It plans to analyze consumer behavior, as well as the bargaining power of the main players with the companies that provide content for the devices.
Selina Chadha, Director of Connectivity at Ofcom, said:
“The way we live, work, play and do business has been transformed by digital services. But as the number of platforms, devices and networks delivering content grows, so do the technological and economic issues facing regulators. .
That is why we are putting in place a work program to analyze these digital markets, identify any competition problems and make sure they work well for the people and companies that trust them.”
All products recommended by Engadget are selected by our editorial team, independent of our parent company. Some of our stories include affiliate links. If you buy something through one of these links, we may earn an affiliate commission. All prices are correct at time of publication.