NEW Report | Engineering the Cloud Commons: Tackling Monopoly Control of Critical Digital Infrastructure
The US, Europe, and other governments must view Cloud as a form of core utility and as a single integrated system, and regulate it to ensure resiliency, security, openness, and sustainability.
The Open Markets Institute has released a new report, “Engineering the Cloud Commons: A Blueprint for Resilient, Secure, and Open Digital Infrastructure,” that offers a long-overdue reconception of cloud computing as a single integrated system whose essential nature for all aspects of modern life requires that it be regulated as a utility of foundational importance to society.
Our report argues that cloud should be acknowledged and governed as public infrastructure akin to electricity or telecommunications. This will entail not just regulating systemically important cloud providers, but also restructuring the market to protect this critical infrastructure from the control and influence of dominant tech giants.
Cloud computing already underpins most of the 21st century economy. From health care to finance, from defense to communications, almost all critical services today depend on cloud computing. Further, this foundational role will only increase, given U.S. plans to back the $500 billion Stargate initiative and the EU’s InvestAI program advancing as part of its AI Continent Action Plan.
But without a sustained effort to tackle Big Tech’s tight grip on the cloud market (today just three U.S.-based companies—Amazon, Microsoft, and Google—control two-thirds of the global cloud capacity), such efforts will only deepen our societies’ vulnerability to economic coercion, foreign interference, manipulation of the flow of information and debate, and potentially catastrophic disruptions of essential services and industries.
The 2024 CrowdStrike outage and other recent incidents illustrate the vulnerability this centralized – yet entirely unregulated - control of critical computing infrastructure presents. This concentration of capacity and power also undermines fair competition in the cloud market and enables a handful of tech giants to steer the trajectory of innovation in the downstream markets and technologies that rely on access to cloud computing, including artificial intelligence. As U.S. antitrust officials warned during Open Markets’ “AI in the Public Interest” event in 2023, existing tech monopolies have a “leg up” in AI because of their vast access to cloud computing capabilities and data.
Despite the growing array of risks posed by our dependence on concentrated cloud infrastructure, the industry remains largely unregulated.
The report offers three key policy recommendations:
Utility-style Regulation: Drawing on models applied to essential services such as electricity, telecommunications, and railways a dedicated regulator should ensure that cloud infrastructure is (a) operated safely, sustainably, and transparently, including through regular auditing and stress testing, mandatory interoperability and data portability, and comprehensive environmental reporting, and (b) accessible to all comers on fair, transparent and non-discriminatory terms.
Structural Separation: Dominant tech giants would be required to divest their cloud businesses, which would subsequently be owned and run as independent entities. This measure—also inspired by regulation of other essential infrastructure—would prevent cloud providers from (a) giving preferential access to other services they own, at the expense of third parties and (b) using their control of non-cloud services, such as operating systems, to lock customers into their cloud infrastructure.
Public investment and procurement: While the state should not aim to replace the private sector as the main provider of cloud infrastructure, well-designed public support could play an important role in raising standards, diversifying the cloud market, and increasing security in the near term. Redirecting public procurement budgets away from the three dominant providers would help also lessen the power of today’s dominant providers, while targeted investments in “public compute” could be used to host sensitive public data or to provide cloud access to researchers, non-profits, startups and others not adequately served by the market.
We will discuss these recommendations and more during a Trans-Atlantic webinar on May 15th, 9 AM ET with the report authors and other experts in this space.
“Engineering the Cloud Commons” delivers a clear message: cloud computing is too important to be left in the hands of unaccountable private monopolies. Bold thinking and action are required to ensure that this foundational infrastructure supports open, competitive markets, democratic values, and societal resilience.
The Open Markets Institute examined rising Big Tech control over cloud computing in conjunction with the rapid growth and concentration of AI in our 2023 report, “AI in the Public Interest: Confronting the Monopoly Threat,” and at our solutions-orient discussion event tied to the release of that report. Open Markets also published a report with Mozilla urging action and has recommended both the U.S. and EU governments address concentration over cloud computing and related information technologies in their approaches to technology policy.
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