Context: A few months ago, the European Commission (EC) sent Google (formally, its parent company named Alphabet) two sets of preliminary findings of non-compliance with one of the bloc’s platform regulations, the Digital Markets Act (DMA) (March 19, 2025 EC press release). But Google is not only on the receiving end of enforcement. In various jurisdictions, Google is trying to leverage existing and potential future competition and platform rules against its main competitors in the cloud business, Amazon and Microsoft (May 16, 2025 ai fray article).
What’s new: Today, the initial feedback and consultation period for the EU’s contemplated Cloud and AI Development Act (CAIDA) is ending (EC webpage). Global Competition Review has been first to report on what a presumably Google-led lobbying group is telling the EC in this context (July 1, 2025 GCR article (paywalled)): according to the Open Cloud Coalition (OCC), the CAIDA should “build upon and reinforce” the DMA and other digital regulations while addressing “specific gaps” in connection with cloud services.
Direct impact: EU decision-makers have recently declared an intent to cut back on digital regulations, withdrawn a couple of bills and discussed delaying the enforcement of some existing rules. Against that backdrop, the OCC’s call for more regulation (in the form of certain provisions in the envisioned CAIDA) may fall on deaf ears or will at least face significant skepticism. The fact that Google is speaking out of both sides of its mouth — calling for more DMA-like regulatory initiatives when it seeks to harm its competitors while telling the EU that the DMA stifles innovation (July 1, 2025 article by Competition Policy International) — further reduces the likelihood that Google will get its way.
Wider ramifications: Regardless of Google’s agenda concerning Amazon Web Services and Microsoft Azure, the EC and other EU institutions will have to think about whether an initiative such as the CAIDA, which reflects the bloc’s ambition to strengthen the use and development of AI technologies, should be hijacked for the purpose of more regulation, particularly in connection with legacy issues such as the licensing of decades-old business software products to cloud services and their customers.
The OCC denies that it is led by Google and points to a “one member, one vote” decision-making process, yet there are unanswered questions regarding the funding structure and potential gifts by Google to the smaller companies that joined the group (October 28, 2024 TechCrunch article). At minimum, there are no signs of Google distancing itself from the OCC’s push for more regulation. Google’s agenda in that regard is well-documented, not least because of an ongoing market investigation by the UK Competition & Markets Authority (CMA).
Google’s opposition to the DMA’s rules with respect to search engines and app stores is equally incontrovertible. If it was up to Google, the DMA enforcers would declare Amazon and Microsoft (but not Google, despite its strong market position and growth in the cloud business) “gatekeepers” while discontinuing all enforcement around search engines and app stores.
In addition to its own extensive advocacy, Google uses organizations such as the OCC or ACT | The App Association, of which Google has recently become a sponsor as part of its alignment with Apple on mobile app store issues (June 24, 2025 ip fray article). ACT is clearly against the DMA, and claiming to represent small app developers while not taking any membership dues from them (by its own admission).
Large and diversified corporations often have divergent interests. In markets where they are a challenger, they want regulators to make it harder for the incumbents to defend or gain market share. In markets where they are a monopolist or duopolist, they describe regulation as an impediment to innovation. To some degree, that is par for the course. However, there are two credibility issues related to cloud regulation that are unusual:
- Google told the UK CMA that AI is not a major driver of demand for cloud services, but tells shareholders that the cloud business is now primarily about AI (April 25, 2025 ai fray article).
- Now Google is telling the EC that the DMA stifles innovation and increases consumer prices while pushing for the potential application of the DMA to cloud services and even asking for more regulation than the DMA could provide in that regard.
There obviously is a lot for Google to gain. It can make it harder for other major cloud providers to compete, and it can deflect from its own regulatory issues, binding agency resources in Brussels, London and elsewhere that could otherwise be used to deal with market failures (while the cloud market is thriving and demonstrably competitive).