AWS and Azure face EU cloud gatekeeper designation and fines

This designation marks the first time the Digital Markets Act has expanded from consumer platforms into the foundational infrastructure layer. For streaming services and media enterprises, this shift could lower the technical and financial barriers to multi-cloud strategies by forcing AWS and Azure to dismantle proprietary lock-in mechanisms. While Google Cloud currently sits outside this specific proceeding, the regulatory pressure on its larger rivals creates a new competitive opening for smaller European providers like OVHcloud and Scaleway. The immediate ecosystem impact will likely manifest as negotiated licensing concessions rather than a total pricing overhaul. Watch for the Commission's final decision in November to see if the compliance timeline aligns with the January 2027 Data Act deadline.

The push to designate AWS and Azure as gatekeepers under the Digital Markets Act has been driven in large part by CISPE, the Cloud Infrastructure Services Providers Europe association, whose members include OVHcloud, Scaleway, and other European cloud operators. In early 2025, CISPE filed a formal complaint with the European Commission alleging that AWS and Microsoft Azure engaged in anti-competitive licensing practices that locked customers into their platforms through data egress fees and bundled software terms. The complaint specifically cited AWS S3 egress pricing and Azure's hybrid benefit licensing as mechanisms that made multi-cloud migration economically prohibitive for European enterprises, including media and streaming workloads that move large volumes of video data between environments.

The regulatory timeline intersects with the EU Data Act, which entered into force in January 2024 and becomes fully applicable in September 2025, requiring cloud providers to offer switching tools and eliminate egress charges after a transition period. The European Commission published guidance in March 2026 clarifying that DMA gatekeeper obligations would complement Data Act switching requirements rather than duplicate them, meaning designated providers face both horizontal switching mandates and platform-specific interoperability duties. EU digital regulation strategy shifts as Brussels balances deregulation with new rules, and Deutsche Telekom, which has publicly supported stricter cloud regulation, operates its own sovereign cloud offering and has lobbied for enforcement that prevents hyperscalers from using bundled networking and CDN services to reinforce lock-in.

Cloudflare, which operates the R2 object storage service explicitly positioned as a zero-egress-fee alternative to AWS S3, stands to benefit from any mandate that forces AWS to reduce or eliminate data transfer charges. Cloudflare reported in its Q2 2026 earnings call that R2 storage capacity had grown more than 300% year over year, with media and entertainment customers citing egress cost reduction as the primary migration driver. If the Commission's gatekeeper designation compels AWS to open its APIs and reduce switching friction, the competitive pressure on S3 pricing could accelerate further, particularly for bandwidth-intensive streaming and content delivery workloads that currently anchor many media companies to a single hyperscaler.