The European Commission has preliminarily ruled that Amazon Web Services and Microsoft Azure should be classified as "gatekeepers" under the bloc's Digital Markets Act—a move that could fundamentally reshape how cloud infrastructure operates across the continent and affect businesses relying on these platforms for daily operations.
Why This Matters
• Compliance deadline: If confirmed, both companies have 6 months to restructure their cloud offerings to meet EU interoperability and data portability requirements.
• Lower exit costs: The ruling targets data egress fees—charges that have historically locked businesses into single-vendor ecosystems—with full elimination planned for January 2027.
• Competitive pressure: This marks the first qualitative application of the Digital Markets Act to cloud infrastructure, potentially leveling the field for smaller European providers.
Impact on Expats and Business Owners in Portugal
For Portugal-based entrepreneurs, freelancers, and tech firms, the gatekeeper designation could translate into tangible cost savings and strategic flexibility. Data egress fees have historically functioned as a hidden tax on multi-cloud strategies or migrations to cheaper providers. Eliminating those fees removes a significant barrier, especially for startups experimenting with different hosting environments or seeking to comply with data residency requirements under national procurement rules.
Interoperability mandates may also accelerate the adoption of hybrid cloud setups, where sensitive data remains on-premises or with European providers (such as OVHcloud or Hetzner), while compute-intensive workloads run on AWS or Azure. This approach aligns with the Portugal 2030 Digital Transition strategy, which emphasizes technological sovereignty and reduced dependency on non-EU infrastructure.
The Portugal Digital Economy Council, which advises the government on tech policy, has noted that Portuguese startups and mid-sized firms disproportionately rely on AWS for hosting, making egress fees a recurring pain point. According to industry reports, some Lisbon-based startups have reported spending upwards of €12,000 annually just to move archived data between AWS and backup providers—equivalent to roughly two months of junior developer salaries in the capital.
However, compliance timelines matter. If the final ruling lands in October and the six-month implementation window closes in April 2027, businesses planning major cloud migrations or contract renewals should anticipate a period of regulatory and technical flux. Consulting with legal advisers familiar with DMA obligations—and with cloud architects experienced in multi-vendor environments—will be essential for mitigating risk.
The Qualitative Assessment Framework
Unlike previous gatekeeper designations under the Digital Markets Act (DMA), which relied on hard thresholds—€7.5B in EU turnover, 45M monthly active users, and operations in at least three member states—this preliminary determination breaks new ground for cloud services. Both AWS and Azure fall short of those quantitative benchmarks for their cloud services alone. Yet Teresa Ribiera, Vice President of the European Commission, invoked a lesser-used provision that allows regulators to designate platforms based on market impact, intermediary function, and entrenched positioning.
According to first-quarter 2026 data from Synergy Research Group—figures available at the time of the June 2026 preliminary ruling—AWS and Azure command 65-70% of EU cloud revenue combined, dwarfing competitors including Google Cloud, Oracle, and IBM. The Commission's rationale hinges on three pillars: multi-year market leadership, operational and investment capacity that "significantly surpasses competitors," and vast, locked-in user bases benefiting from high switching costs and ecosystem effects.
What Gatekeeper Status Actually Means
If the October 2026 final decision confirms the preliminary findings, AWS and Azure will face a raft of binding obligations designed to dismantle what regulators call "lock-in" dynamics:
Mandatory Interoperability: Cloud services must work seamlessly with rival platforms in defined scenarios, enabling hybrid and multi-cloud architectures without proprietary friction.
Egress Fee Caps and Elimination: Charges for transferring data out of AWS or Azure will be restricted immediately, with a full ban starting January 2027. This provision alone could save European businesses millions in migration costs.
Self-Preferencing Ban: Neither platform may favor its own AI tools, analytics services, or adjacent products over third-party alternatives in search results, recommendations, or bundled offerings.
Enhanced Data Portability: Businesses must be able to extract their data—structured and unstructured—in standard formats, reducing the technical complexity that currently deters vendor changes.
Fair Contractual Terms: The Commission will scrutinize bundling practices, licensing conditions, and pricing structures to ensure they don't penalize customers who opt for competitor services.
No Cross-Platform Tracking for Ads: User activity outside the core cloud platform cannot be leveraged for targeted advertising without explicit consent.
Non-compliance carries steep penalties: fines up to 10% of global annual turnover, escalating to 20% for repeated violations. For Amazon and Microsoft, whose combined cloud revenue exceeds $100B globally, the financial stakes are substantial.
The Corporate Pushback
Amazon has mounted a vigorous defense, arguing that the DMA was architected for two-sided consumer platforms—think app stores and social networks—not business-to-business infrastructure. The company contends that cloud services lack the "intermediation, network effects, or gateway" characteristics the law was designed to regulate. In a statement circulated to EU policymakers, AWS warned that layering DMA obligations atop the EU Data Act—which already governs cloud data practices—would "undermine European competitiveness" and chill investment in the region.
Microsoft adopted a different tack, expressing concern that the Commission's preliminary ruling "ignores the growing power of Google Cloud and Gemini," suggesting its legal strategy will pivot on alleged errors in market definition. The Redmond-based firm has pointed to Google's aggressive expansion in generative AI and cloud infrastructure as evidence that the competitive landscape is more fluid than regulators acknowledge.
Both companies have until September 2026 to submit written rebuttals and review investigation documents. A final determination is expected by late October 2026, with the compliance clock starting immediately thereafter.
Google's Conspicuous Absence
The Commission's decision not to open a parallel investigation into Google Cloud has drawn sharp criticism from industry groups and rivals. The Cloud Infrastructure Services Providers in Europe (CISPE) trade association argues that Google's rapid growth in both cloud and AI markets—fueled by the Gemini platform—merits equivalent scrutiny. Microsoft's public comments echo this view, framing the omission as a potential distortion that benefits Google at the expense of a level playing field.
First-quarter 2026 figures show Google Cloud holding roughly 10-12% of EU cloud revenue, trailing AWS and Azure but growing faster year-over-year. Critics contend that Google's vertical integration—spanning search, advertising, Android, and now AI—creates lock-in dynamics comparable to those cited against Amazon and Microsoft.
Broader Implications for the EU Digital Market
The AWS-Azure gatekeeper determination represents a regulatory escalation, extending DMA oversight beyond consumer-facing platforms to the foundational infrastructure layer of the digital economy. It signals that Brussels intends to wield qualitative assessments aggressively when platforms exhibit sufficient market concentration and switching friction.
This precedent could embolden regulators to scrutinize other infrastructure segments—content delivery networks, domain registrars, or even payment processors—if they exhibit similar characteristics. A parallel example emerged in June 2026, when the Court of General Court partially upheld Meta's gatekeeper status while overturning the designation for Facebook Marketplace, though Messenger obligations remained intact. This decision, arriving contemporaneously with the AWS-Azure ruling, underscores that qualitative gatekeeper determinations face judicial scrutiny and that regulatory outcomes are contestable.
For Portugal, which hosts a growing number of tech hubs in Lisbon, Porto, and Braga, the ruling may attract investment from European cloud providers seeking to capitalize on regulatory tailwinds and data sovereignty concerns.
The Road Ahead
Between now and October, expect intensive lobbying, technical briefs, and possibly behind-the-scenes negotiations as Amazon and Microsoft seek to narrow the scope of potential obligations or delay implementation timelines. Industry observers anticipate that both firms may offer voluntary commitments—such as capped egress fees or enhanced portability tools—in exchange for a lighter regulatory touch.
For businesses in Portugal and across the EU, the message is clear: the cloud market is entering a phase of enforced openness, where the cost and complexity of switching providers should decline, and where dominant platforms face binding obligations to play fair. Whether that vision materializes depends on the Commission's final decision, the companies' willingness to comply, and the courts' interpretation of the DMA's qualitative gatekeeper provision.
In the meantime, prudent CFOs and IT directors should model scenarios for both outcomes—compliance-driven cost reductions and potential service disruptions during the transition—and structure cloud contracts with enough flexibility to pivot as the regulatory landscape solidifies.
