Want to Quit AWS? Amazon says OK
Looks like the EU baring its fangs around antitrust penalties is having its impact elsewhere too
Amazon Web Services (AWS), the cloud computing subsidiary of Amazon has said henceforth it would allow costumes to transfer their data out of its ecosystem without asking them to pay any fees for doing so. It is part of Big Tech’s effort to stave off antitrust moves (as seen by EU’s penalty on Apple) or just a case of matching up with Google’s announcement, we can’t say.
Readers would recall that about two months ago, Google had come out with similar plans of eliminating data transfer fees for switching cloud providers claiming that it “will make it easier for customers to change their cloud provider”. The small matter that Google is third in the pecking order in a triopoly comprising AWS, Azure and Google Cloud makes its decision different as anyone seeking to move away from the other two would think Google is a better option.
Google had taken potshots at its rival
In fact, at that time, Google had taken potshots at “legacy providers” leveraging “their on-premises software monopolies to create cloud monopolies, using restrictive licensing practices that lock in customers and warp competition. No prizes for guessing whom they are referring to! Does it mean Google could be the next Spotify to lead an antitrust battle in the EU?
Here is what Google had said then: “The complex web of licensing restrictions includes picking and choosing who their customers can work with and how; charging 5x the cost if customers decide to use certain competitors’ clouds; and limiting interoperability of must-have software with competitors’ cloud infrastructure. These and other restrictions have no technical basis and may impose a 300% cost increase to customers. In contrast, the cost for customers to migrate data out of a cloud provider is minimal.”
“Making it easier for customers to move from one provider to another does little to improve choice if customers remain locked in with restrictive licenses. Customers should choose a cloud provider because it makes sense for their business, not because their legacy provider has locked them in with overly restrictive contracting terms or punitive licensing practices,” the company said in the blog post dated January 12, 2024.
Looks like AWS is responding now
Now, coming to AWS, they already allowed customers to transfer up to 100GB of data a month off their servers for free, but didn’t cover those seeking to move bags and baggage to another provider. The European Data Act provisions allows cloud customers to switch providers more easily to (a) a totally different cloud, (b) adopting a multi-cloud approach or (c) putting all their data back in-house on an on-premises cloud.
AWS shared a blog post that appeared to address Google’s diatribe in some ways. “We believe in customer choice, including the choice to move your data out of AWS. The waiver on data transfer out to the internet charges also follows the direction set by the European Data Act and is available to everyone across the world. “Freedom of choice is not limited to data transfer rates. AWS also supports Fair Software Licensing Principles, which make it easy to use software with other IT providers of your choice,” it said while sharing another blog post link.
EU Antitrust rules have them worried!
While the European rules govern only that geographical area, both Google and AWS have made the change in their operations at a global level. Now, it remains to be seen whether Microsoft also follows suit or prefers to stick it out given that they offer an entire service suite and are sitting pretty since going after the cloud business.
A report from Synergy Research found that the cloud market exceeded $61 billion for the last quarter of 2022 with the 12 month trailing revenues of over $212 billion. The triumvirate ruling the market saw growth slow down but Microsoft gained market share over AWS. It grew to 23% from 21% in Q3 when AWS fell from 34% to 33% while Google stayed steady at 11%. From a revenue perspective, the numbers indicated that AWS made approximately $20 billion while Microsoft accounted for $14 billion with Google getting $7 billion during the period.
Of course, readers would also note that these steps taken by Google first and Amazon now come at a time when there is an ongoing antitrust probe in the UK over cloud lock-in practices. A key factor around this probe concerned the egress fees, which means Microsoft has no choice but to follow the other two unless it wants to take on the regulators head-on.
By the looks of how things are panning out, there is every likelihood that Big Tech believes in the old adage: “Better hang together, lest we get hung individually”.
