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Do AWS, Azure, Google, Oracle, Others Have Too Much Market Power?

The FTC, concerned about cloud vendors' sway over customers, is seeking public comment.

Do Amazon Web Services, Microsoft Azure, Google Cloud, Oracle Cloud and other cloud vendors hold too much market power?

That's the question the U.S. Federal Trade Commission seeks to answer.

This week, the competition watchdog said it's collecting public comment until May 22. Regulators in a March 22 press release said they want insight into the following topics:

  • The extent to which particular segments of the economy rely on a handful of cloud service providers.
  • The ability of cloud customers to negotiate their cloud contracts or if they experience take-it-or-leave it standard contracts.
  • Incentives providers to get more business from each customer.
  • The extent to which cloud providers compete on their ability to provide secure storage for customer data.
  • The types of products or services cloud providers offer based on, dependent on, or related to artificial intelligence; and the extent to which those products or services are proprietary or provider agnostic.
  • The extent to which cloud providers identify and notify their customers of security risks related to security design, implementation or configuration.

FTC staff also want feedback on how cloud computing impacts specific industries, including health care, finance, transportation, e-commerce and defense.

"Large parts of the economy now rely on cloud computing services for a range of services," said Stephanie Nguyen, chief technology officer at the FTC.

The request for public comment on cloud providers' market power, Nguyen added, "is aimed at better understanding the impact of this reliance, the broader competitive dynamics in cloud computing and potential security risks in the use of cloud."

Cloud Vendors Do Hold Sway — Is It the Same as Market Power?

To be sure, cloud vendors hold a lot of sway over their users. Between contractual obligations, hidden fees and security risks, organizations can end up paying more for cloud computing than by using on-premises alternatives. But getting out from under a public cloud service can be difficult. For one, many contracts call for a three-year minimum commitment. For another, it's easy and cheap to put files and data into the cloud. Removing it is where the fees rack up. These egress charges are earning more scrutiny, IDC analyst Dave McCarthy said last month.

Read the rest of this article on Channel Futures.

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