The UK’s competition watchdog says it has forced AWS and Microsoft into improving their cloud data egress positions after a lengthy enquiry,

Azure has been pushed to expand the switching scenarios that qualify for free egress to include customers exiting single Azure services in the UK, as well as those leaving Azure entirely, “annex 1” of its landmark decision showed.

AWS, as part of a new UK addendum to its terms, has also included free data egress for UK customers switching services, rather than migrating out of AWS Cloud.

In new terms for UK customers exiting its cloud, Microsoft said that while it has already “abolished egress fees globally for customers switching clouds, for UK customers, we will extend this further… Free egress will apply not only to transfers using standard ISP egress, but also to transfers using [Microsoft Global Network or MGN] from UK datacenters."

The announcement comes after a protracted investigation by the Competition and Markets Authority (CMA) into cloud provider lock-in.

Many observers had expected this to trigger a deeper strategic market status "SMS" investigation into cloud services. But the moves by both to adapt egress fees and improve interoperability have kept this threat at bay.

See also: Google Cloud is NOT magicking away data egress fees

"These changes will reduce expense and effort for UK customers when using more than one cloud provider," claimed the CMA.

Amazon and Microsoft are participating with the CMA voluntarily on interoperability and egress changes. Taken at face value, said Kip Meek, the former chair of the investigation, that helps mitigate the “unintended consequences of a remedy.”

Meek told The Stack the cloud decision was “a perfectly sensible and pragmatic approach by the CMA”. Critics such as cloud provider Civo’s Chief Commercial Officer Simon Hansford warned that “voluntary commitments from tech giants are… difficult to enforce.”

 AWS has detailed some of the changes it is making here.

They span a mix of previously announced product releases like November 2025’s release of AWS Interconnect multicloud, the tweaks to data egress rules, and the promise of “upcoming updates to AWS Security Hub [that] will enhance multicloud capabilities, using a common data layer designed to unify security signals from any environment.”

See also: CMA cloud inquiry chair quits, cites "slow pace"

On interoperability, AWS has promised further collaboration with the CMA, again at the company’s discretion. It said it will work with the authority when presented with testimonies from UK cloud customers in the future and “collaborate on solutions to specific technical obstacles to interoperability that are identified through the CMA’s engagement…”

Microsoft has also promised changes for improved cloud interoperability, including a “new, dedicated interoperability request mechanism” for competing cloud providers in the UK which it said should be online within six months.

The process promises “a transparent, structured, and accessible way for cloud providers to raise interoperability requests.”

Warning shot fired at Microsoft

Redmond, however, will still face a SMS investigation starting in May, on what the CMA tagged as a major concern: "Microsoft’s use of software licensing reducing competition in cloud"

In 2025, the CMA found that AWS and Microsoft had significant cloud market power, and took particular aim at the “licensing of Microsoft’s key business software on the cloud."

This ruling was the top concern for Meek. On the CMA’s decision to use its new powers to investigate Microsoft’s business software licensing, Meek said “I'm very supportive of that decision by the CMA board to go down this route. (...) I've been critical in the past, but I think this is good.”

Microsoft's new terms

"We recognize that the CMA will continue to review and assess additional issues relating to our products and services, including in the business software market," said Microsoft president Brad Smith in a statement.

Smith said Microsoft had "long been committed to addressing the competition and antitrust issues raised by regulators and enforcement agencies", and that "this has served our shareholders and customers well, avoiding protracted litigation, legal defeats, and large fines."

AWS adds to deal

AWS immediately published a UK Customer Switching and Portability Addendum to its standard cloud terms that offers "reasonable assistance" with the process, and guaranteed continuity during the switch.

Under the new rules, AWS will give customers credits for the cost of transfer, as well as cost-price transfer for data not considered to be part of the switch as long as it is to a new provider rather than to customers or a third party.

Amazon's associate general counsel Andrew DeVore said the company's embrace of ongoing engagement with the CMA had been "both productive and transparent."

"Swift action"

The Open Cloud Coalition called on the CMA to keep a close eye on AWS and Microsoft's implementation of their new terms.

The CMA should "take swift action should Microsoft and AWS fail to meet their commitments on egress fees and interoperability, and to ensure those commitments are meaningful," said senior advisor Nicky Stewart.

"Slow progress on these issues continues to hamper growth, innovation and resilience in the UK cloud marketplace. Decisive action will set a benchmark for competition authorities across Europe and beyond."

See also: AWS wins controversial £473m hyperscaler-only HMRC contract

Former CMA chair Meek told The Stack that “There are quite a lot of complexities associated with trying to remedy any competition problems that arise from interoperability. You put in place something that says interoperability has to operate in this way, and that could hamper innovation by, let's say, that remedy applied to Amazon and Microsoft.”

Meek caveated he was no longer involved in the CMA and had to take the claims that the companies are working with the authority at “face value.” However, he said for the moment, the engagement was “a good thing.” 

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