Amazon Web Services and Microsoft Azure must prepare to overhaul their European operations after the European Commission signaled on June 25, 2026, that the two cloud giants should be treated as gatekeeper services under the Digital Markets Act. The preliminary designation, which opens a six-month countdown to full compliance, marks the most aggressive regulatory move yet against the infrastructure backbone of the continent’s digital economy.

The Commission’s announcement, delivered through a formal ‘Statement of Objections’ to both companies, asserts that AWS and Azure hold entrenched positions that stifle competition and harm business users. If finalized, the decision will subject them to a sweeping set of obligations designed to tear down proprietary walls, eliminate self-preferencing, and guarantee the free movement of workloads between cloud providers.

The Gatekeeper Trigger

The Digital Markets Act, enforceable since May 2023, targets large online platforms that act as ‘gatekeepers’ between businesses and consumers. Until now, it has focused on consumer-facing core platform services — search engines, social networks, operating systems, and marketplaces from the likes of Alphabet, Apple, Meta, and Amazon’s own e-commerce marketplace. Extending the law to cloud infrastructure-as-a-service and platform-as-a-service offerings represents a dramatic leap into the enterprise technology stack.

The Commission’s preliminary investigation found that both AWS and Azure meet three cumulative criteria: they have a strong market position in the European Economic Area, they serve as a key gateway for business users to reach end customers, and their positions are durable over time. Public revenue figures and market share analysis from sources like Synergy Research Group back up these findings, with AWS controlling roughly 33% of the European cloud market and Microsoft Azure holding around 23%.

Crucially, the designation covers specific core platform services. For Amazon, the Commission listed Amazon Web Services’ EC2 compute, S3 storage, and the AWS Marketplace. For Microsoft, the gatekeeper label applies to Azure Virtual Machines, Azure Blob Storage, Azure Active Directory, and the Azure Marketplace. Both companies will also need to address the role of their proprietary management tools and licensing practices that the EU says lock businesses into single-vendor ecosystems.

Measures That Could Reshape the Cloud

Once formally designated, AWS and Azure will have 45 days to submit a detailed compliance report, with all obligations becoming fully effective within six months. The obligations are not generic; the Commission will tailor them to the specific bottlenecks identified in the cloud market. Based on the DMA’s text and the Commission’s previous enforcement patterns, several commitments are likely:

  • Interoperability mandates: Companies must provide APIs and tooling that allow customers to seamlessly move data, workloads, and applications between cloud providers without incurring technical or financial penalties. This could force AWS and Azure to adopt open standards like the Cloud Infrastructure Services Providers in Europe (CISPE) framework, ending the era of high egress fees and incompatible management planes.
  • Anti-self-preferencing rules: Both vendors will be barred from giving preferential placement to their own software and services within their marketplaces. That means Azure cannot showcase Microsoft 365 or Power Platform over a competing CRM tool, and AWS cannot manipulate search rankings to disadvantage third-party security or database offerings.
  • Fair licensing terms: Microsoft’s controversial 2019 licensing policy, which made it more expensive to run Windows Server and SQL Server on non-Azure clouds, will be squarely in regulators’ crosshairs. The DMA requires that gatekeepers do not use licensing terms to disincentivise customers from choosing rival infrastructures. Amazon, too, will need to decouple its proprietary machine learning and analytics services from the core compute and storage layers, ensuring customers can mix and match without economic or contractual barriers.
  • Data access and portability: Business users will gain real-time access to their own data generated on the gatekeeper’s infrastructure, with the right to port it to another provider at any moment. This provision echoes Article 20 of the GDPR but with more aggressive timelines and technical specificity.
  • Ban on tying and bundling: The Commission may prohibit the two from requiring customers to purchase one service as a condition for buying another core service, a practice that critics argue is widespread in enterprise licensing agreements.

Non-compliance carries a sting: fines of up to 10% of a company’s total worldwide annual turnover, with the possibility of doubling to 20% for repeat offenses. For Amazon, whose 2025 revenue surpassed $600 billion, a 10% penalty would amount to €55 billion; for Microsoft it could exceed €30 billion. The threat alone is enough to focus corporate minds.

Beyond the financial pain, the DMA gives the Commission structural remedy powers. In an extreme scenario, if a gatekeeper systematically fails to comply, the EU could mandate the separation of certain business units — a nuclear option that Brussels has never triggered but that hangs over the companies’ long-term planning.

A Timeline of Tension

The Commission’s Statement of Objections is a preliminary document. Amazon and Microsoft now have eight weeks to respond in writing and request an oral hearing. Both are expected to mount vigorous defenses, arguing that the cloud market is competitive, that switching costs are manageable, and that customers willingly choose integrated suites. Following the hearing, the Commission will issue a final decision, likely by late October 2026. If the gatekeeper designation is confirmed, the six-month compliance clock will start from that final notification.

In parallel, the European Commission is conducting a separate market investigation into the broader cloud computing sector, which could expand the gatekeeper list to include Google Cloud Platform and possibly Oracle Cloud Infrastructure in the future. That probe is expected to conclude in early 2027.

Industry and Customer Reactions

Although the official announcement landed less than a day ago, the initial response from industry groups and enterprise customers has been swift. CISPE, which has long campaigned against unfair software licensing practices, called the decision “a watershed moment for the European cloud industry.” A spokesperson noted that “for years, cloud infrastructure providers have weaponised licensing and technical lock-in. Today’s action paves the way for genuine competition.”

Conversely, the Computer & Communications Industry Association (CCIA), which counts both Amazon and Microsoft as members, warned that the designation could “stifle innovation and harm the seamless integration that customers demand.” The statement argued that enterprise cloud procurement is a nuanced, consultative process, not a one-sided gatekeeper dynamic.

Large European enterprises offered a mixed view. An IT director at a major German automotive manufacturer, who requested anonymity, said: “We’ve been wanting to use a multi-cloud strategy for years, but the technical friction and hidden costs are immense. If the DMA forces real interoperability, that could save us millions and reduce vendor lock-in.” However, a banking CTO in Paris cautioned: “Regulation is a blunt instrument. I worry about unintended consequences — slower innovation, degraded performance, or Microsoft and Amazon simply charging us in other ways.”

The financial community is already gaming out the impact. Analysts at Gartner forecast that cloud services spending in Europe, currently around €120 billion annually, could shift 5–10% from the incumbents to challengers like Deutsche Telekom’s Open Telekom Cloud, OVHcloud, or even non-European players like Alibaba Cloud, if the DMA eliminates lock-in penalties.

What the Companies Are Saying

In carefully worded statements, both Amazon and Microsoft acknowledged the Commission’s action while emphasizing their contributions to Europe’s digital transformation.

Microsoft President Brad Smith reiterated the company’s “commitment to a competitive and open cloud ecosystem” and pointed to recent policy changes, such as the European Cloud Principles adopted in 2022 and the Azure IP Advantage program. He did not, however, confirm whether Microsoft would voluntarily adopt the full set of DMA obligations ahead of the deadline.

Amazon’s statement was more combative. “We respectfully disagree with the Commission’s preliminary assessment,” an AWS spokesperson said. “AWS operates in a fiercely competitive market, with customers free to choose from dozens of providers. The DMA gatekeeper criteria were never intended to cover business-to-business infrastructure services, and we will make that clear in our response.”

Legal experts note that the companies’ defensive strategies will likely hinge on two arguments: first, that cloud services are not consumer-facing and therefore fall outside the DMA’s intent; second, that the market definition is wider than the Commission claims, encompassing on-premises data centres and managed hosting. Similar challenges have failed in past antitrust cases, but the DMA’s novel framework gives them room to fight.

The Broader DMA Landscape

This cloud designation is not happening in isolation. It comes as the Commission is simultaneously re-examining Apple’s compliance with iOS and App Store rules, following complaints from Spotify and Epic Games. Google, too, is under a formal non-compliance investigation in the online search and advertising domain. The cloud gatekeeper ruling signals that Brussels is willing to push the DMA deep into B2B markets, a precedent that could eventually sweep in other sectors like industrial IoT platforms, payment gateways, and logistics software.

The United States, which has its own Department of Justice antitrust actions against Google and potentially Amazon, is watching closely. A senior official at the US Federal Trade Commission said last month that “the DMA’s cloud experiment could inform our own regulatory thinking,” raising the possibility of transatlantic regulatory convergence — or collision.

Counting Down to Compliance

With six months to act, the clock is ticking. What will change for enterprise customers in practice?

First, expect a rush of technical announcements from both AWS and Azure unveiling new migration tools, open APIs, and multi-cloud management features. Some of these may have been under development for months, anticipating this decision. An Azure engineer, speaking on background, described a “war room” to accelerate the Cobalt and Radius multi-cloud projects, which could ship long before the compliance deadline.

Second, licensing is almost certain to be restructured. Microsoft will likely extend the more flexible terms it introduced for Azure Stack and Azure Arc to cover all core Azure services, effectively eliminating the “tax” on running Windows and SQL Server in competing clouds. AWS may decouple services like AWS Lambda, SageMaker, and DynamoDB from the rest of its platform, offering consumption-based pricing that does not tie customers to other AWS primitives.

Third, the marketplaces themselves will change. Both AWS Marketplace and Azure Marketplace will need to implement transparent ranking algorithms that do not favor first-party solutions. That could unlock fresh opportunities for European software firms and open-source projects, which have long complained of being buried in search results.

Despite the upheaval, some analysts believe the DMA may ultimately benefit the incumbents in the long run by forcing them to become more open and customer-centric. David Mitchell Smith, a vice president at Gartner, said: “If AWS and Azure embrace data portability and open standards, they could make themselves even more attractive to risk-averse enterprises, effectively growing the overall cloud market and their slice of it.”

Yet others see a more disruptive scenario. European cloud providers like IONOS, Scaleway, and Deutsche Telekom’s T-Systems are already positioning themselves as “DMA-compliant from day one,” promising seamless integration with any hyperscaler. If the regulation works as intended, they could capture a wave of migration, particularly among public sector and regulated industry clients that have been hesitant to cede control to US tech giants.

Looking Ahead

The June 25 announcement sets in motion a process that will redefine the economics of cloud computing in Europe. Over the next six weeks, the legal filings, public statements, and closed-door negotiations will intensify. The ultimate shape of the cloud market will depend not only on the Commission’s final decision but on how creatively AWS and Azure choose to comply — or how vigorously they resist.

For Windows and Azure customers, the message is clear: the walled gardens are coming down. Multi-cloud architectures will become easier to implement, and the hidden costs of vendor lock-in will diminish. Change will not be painless; short-term disruptions in service integration and pricing are likely. But the long-term promise — a truly competitive, borderless European cloud — may finally be within reach.