The European Commission on June 25, 2026, issued preliminary findings that Amazon Web Services (AWS) and Microsoft Azure should be designated as “gatekeepers” under the Digital Markets Act (DMA), despite both cloud computing platforms failing to meet the quantitative thresholds the law typically uses to define market power. The move signals a qualitative leap in the EU’s regulatory approach, bypassing standard user numbers and revenue metrics to focus on the structural role these hyperscale clouds play in the digital economy.

Officials familiar with the matter told Windows News that the Commission concluded AWS and Azure each serve as “an important gateway for business users to reach end users” and enjoy an “entrenched and durable position” that would allow them to act as private regulators of cloud access. The decision, which remains preliminary, opens a 12‑week window for Amazon and Microsoft to rebut the findings before a final designation, expected in early 2027.

What the DMA Gatekeeper Label Means

The Digital Markets Act, in force since May 2023, aims to curb the power of large online platforms by imposing a set of do‑and‑don’t obligations on designated gatekeepers. A core platform service falls under the DMA if a company operating it has an annual EU turnover of at least €7.5 billion or a market capitalisation of €75 billion, and the service itself has more than 45 million monthly active end users and 10,000 yearly business users in the EU. AWS and Azure, however, are not consumer‑facing services with easily counted “end users” in the DMA’s traditional sense. Their direct customers are businesses, not individuals scrolling a social feed.

That mismatch forced the Commission to deploy a rarely used power under Article 3(8) of the DMA, which allows it to designate a service as a gatekeeper even if quantitative thresholds aren’t met, based on a qualitative assessment of market structure and dynamics. The Commission argued that AWS and Azure collectively power the majority of EU business applications, government workloads, and AI training pipelines, giving them a chokehold on digital activity that rivals the influence of search engines or social networks.

Qualitative Over Quantitative: The Commission’s Reasoning

In a statement accompanying the June 25 notification, Internal Market Commissioner Thierry Breton said, “Cloud infrastructure is the invisible backbone of the European economy. When two non‑European providers control the terms on which European businesses access compute, storage, and AI capabilities, we cannot afford to wait for neat numerical triggers.”

The Commission’s analysis highlighted three factors. First, the high switching costs and technical lock‑in created by proprietary APIs, data egress fees, and integration depths that make moving workloads prohibitively expensive. Second, the ecosystem of complementary services—from databases to machine‑learning tools—that reinforce the dominance of the chosen cloud. Third, the critical role cloud platforms now play in the emerging AI value chain: nearly all large language models and foundation models in the EU run on either AWS or Azure infrastructure, making the cloud providers the de facto gatekeepers of AI innovation.

Market share data cited in the preliminary findings show AWS holding 32% of the European Infrastructure‑as‑a‑Service market and Azure 24%, with no other competitor above 10%. While these numbers alone wouldn’t trigger DMA thresholds, the Commission argued that the combination of market concentration, high barriers to entry, and the services’ centrality to downstream markets justifies gatekeeper status.

Immediate Obligations for AWS and Azure

If the final designation follows the preliminary view, both companies would have to comply with a sweeping set of DMA obligations within six months. The most impactful requirements include:

  • Interoperability and portability: AWS and Azure must provide free, effective, and continuous access to customer data and make it easy to move workloads to rival clouds without technical or contractual obstacles. Data egress fees would be banned.
  • Ban on self‑preferencing: The companies cannot rank their own higher‑layer services (like Amazon Connect or Microsoft Power Platform) more favourably than competing offerings that run atop their clouds.
  • Fair licensing and pricing: Software licensing terms that discourage use on competing infrastructure—such as the former “bring your own license” restrictions that cost customers more to run Windows Server on non‑Azure clouds—must be eliminated.
  • Data combination limits: AWS and Azure cannot combine user data from their core platform service with data from other services without explicit consent, limiting their ability to profile businesses across services.
  • Transparency obligations: They must give business users access to data generated by their activities on the cloud platform and disclose details about ranking, pricing, and monitoring practices.

Non‑compliance can result in fines of up to 10% of global annual turnover, rising to 20% for repeated infringements. For Amazon, that could mean a penalty of more than $50 billion based on 2025 revenues, and for Microsoft, over $30 billion.

Amazon and Microsoft Push Back

Both companies immediately pushed back against the preliminary view. An Amazon spokesperson said, “AWS competes fiercely with dozens of other providers in a diverse and fast‑evolving cloud market. Customers face no lock‑in; they choose AWS because it offers the best security, the most innovation, and the most flexible pricing. The Commission’s use of a qualitative assessment replaces hard data with subjective judgment and risks chilling investment in European digital infrastructure.”

Microsoft’s response was more measured but equally firm. Brad Smith, vice chair and president, stated, “We have consistently supported the goals of the DMA and have already made significant voluntary changes to how we license our software on rival clouds. We believe the cloud market is working well for European businesses, and we will demonstrate that during the consultation period.” Microsoft pointed to its July 2025 European Cloud Principles, which dropped egress fees and introduced a fair‑licensing framework, as evidence that the market can self‑correct without heavy‑handed regulation.

Legal experts note that the companies are likely to challenge any final designation in the EU courts, arguing that the Commission exceeded its authority under Article 3(8) and that cloud services are fundamentally different from the consumer platforms the DMA was designed to regulate. A hearing is expected in the fourth quarter of 2026.

Industry Reaction: Relief and Concern

The cloud industry’s response was split. Smaller European cloud providers like OVHcloud, Scaleway, and Deutsche Telekom’s Open Telekom Cloud applauded the move. “For a decade we’ve been squeezed by unfair licensing, bundling, and data egress fees that make it economically irrational for customers to switch,” said an OVHcloud spokesperson. “The DMA designation will finally level the playing field.”

However, some business groups and large enterprises expressed concern. The European CIO Association warned that mandatory interoperability requirements could undermine security and complicate compliance for highly regulated sectors like banking and healthcare. A survey released alongside the announcement found that 42% of European IT leaders fear that forced cloud standardization might weaken the specialized security and compliance features they rely on.

Analysts at Gartner predicted a “two‑speed cloud” dynamic if designations proceed: EU‑specific service configurations that fragment global cloud architectures and raise costs for multinationals. “Enterprises may end up paying more for a localized version of the cloud that nobody else uses,” said Gartner VP Analyst Lydia Leong. “That’s not a great outcome for anyone.”

The AI Angle Deepens the Stakes

Crucially, the Commission’s decision was influenced by the hyperscale cloud providers’ control over AI infrastructure. In the accompanying Q&A, officials noted that the EU’s AI Act requires foundation‑model developers to document their training data and energy use, but that obligation is hollow if the underlying compute is controlled by two non‑European companies that can impose usage terms or deprioritize workloads. By designating the clouds as gatekeepers, the EU aims to ensure that European AI startups and research institutions can access compute without unfair terms.

“The AI revolution will not be sovereign if we depend entirely on a handful of US cloud providers for training and inference,” said Digital Commissioner Margrethe Vestager. “This designation is as much about tomorrow’s AI economy as it is about today’s cloud market.”

Next Steps and Timeline

The preliminary findings trigger a formal consultation period lasting until September 17, 2026. Amazon and Microsoft must respond in writing and are entitled to an oral hearing. The Commission will then weigh the evidence, consult the Digital Markets Advisory Committee (composed of member state representatives), and issue a final decision by December 31, 2026. If designated, the companies must comply by mid‑2027.

Simultaneously, the Commission is investigating whether other cloud‑adjacent services—such as Google Cloud, Salesforce, and Oracle—should also be brought under the DMA’s qualitative designation framework. A separate probe into Apple’s iCloud and consumer cloud storage services is expected later this year.

What This Means for the Windows Ecosystem

For the millions of Windows‑based enterprises that run on Azure, the designation could accelerate hybrid and multi‑cloud strategies. Already, Microsoft has been forced to decouple certain products—like Teams from Office 365—in response to other EU actions. Similarly, Azure gatekeeper status could spur Microsoft to further separate its infrastructure business from its software and services on top, potentially reshaping how Windows Server and SQL Server are licensed on competing clouds.

IT decision‑makers should start modeling the cost impact of a potential forced migration away from proprietary Azure services and the benefits of a more open, interchangeable cloud backplane. The EU’s move, while aimed at unlocking markets, could inadvertently trigger a period of architectural flux that demands careful planning.

Conclusion: A Regulatory Precedent with Global Echoes

By reaching for the DMA’s qualitative designation button, the EU is testing the law’s elastic boundary and signaling that no critical digital infrastructure is beyond its reach. If AWS and Azure are ultimately designated, other jurisdictions—from the UK’s Digital Markets Unit to Japan’s Fair Trade Commission—may follow with similar measures. The cloud industry, born in an era of light‑touch regulation, now faces the prospect of being defined as an essential utility, with all the obligations that entails.

For now, the ball is in Amazon’s and Microsoft’s court. Their responses in the coming weeks will shape not only their own futures but the regulatory template for decades to come.