The global backlash against the second Donald Trump administration keeps on growing. Canadians have boycotted US-made products, anti–Elon Musk posters have appeared across London amid widespread Tesla protests, and European officials have drastically increased military spending as US support for Ukraine falters. Dominant US tech services may be the next focus.
There are early signs that some European companies and governments are souring on their use of American cloud services provided by the three so-called hyperscalers. Between them, Google Cloud, Microsoft Azure, and Amazon Web Services (AWS) host vast swathes of the Internet and keep thousands of businesses running. However, some organizations appear to be reconsidering their use of these companies’ cloud services—including servers, storage, and databases—citing uncertainties around privacy and data access fears under the Trump administration.
“There’s a huge appetite in Europe to de-risk or decouple the over-dependence on US tech companies, because there is a concern that they could be weaponized against European interests,” says Marietje Schaake, a nonresident fellow at Stanford’s Cyber Policy Center and a former decadelong member of the European Parliament.
I’m just concerned about how this all plays out.
With internet, I totally agree a since it’s an incredibly simple operation, relatively speaking. At the end of the day, it’s bandwidth, latency, stability, and maybe a few features on top, which makes it really simple to standardize, just like with electricity or water.
However, cloud hosting has a lot of moving parts:
There are a ton of reasons to choose one provider over another.
If we instead treat it as a utility, we’ll remove a lot of the differentiation and companies will instead compete purely on margins, as in, who can offer the cheapest, crappiest product that technically meets the requirements. When you can no longer compete on features, you compete on service and margins.
I’m not happy with how dominant AWS is, but that’s what first mover advantage does. Yes, they weren’t the first to create cloud services, but they were the first to create a one-stop shop of services companies want. That opens up opportunities for lock-in, but it also preserves competition for smaller companies to take the market segments that don’t need all those features.
And that’s their core competency: vertical integration. A lot of businesses prefer to be screwed by one vendor instead of several.
I get it.
That said, I think cloud services are starting to settle down. S3 style storage has largely won the war, and now everyone and their dog has an S3-compatible storage engine, which keeps AWS a bit more honest on its pricing. The same will happen with other AWS features, meaning their first mover advantage will be less impactful going forward as competitors catch up.
That’s what lock-in is, it’s just a softer form than things like egress costs. They want you to use AWS services everywhere, which makes switching to a competitor more difficult. AWS’ model is more palatable than others’, but it’s still a form of lock-in.
I think you are dicounting how simple most cloud applications are - compute cores, bucket storage and virtual Networks make up the vast majority, with block storage and serverless compute probably making up a second to everything else being a distant third. I agree that there is specialization involved, but I also believe that regulation could go a long way to ensuring better access and making it possible for more competition. Right now, only a few companies have a monopoly on the datacenter infrastructure itself.
This is actually a lot more similar to power Utilities, which hides a vast and complex system of demand based generation that is hidden by ISOs. A regulatory system could work really well, and deliver much more and better service at lower prices. Otherwise we will see Cloud providers raising prices and offering deals more towards the large enterprises that can build billing support, which was the original complaint.
Not that I think we are close to that. Legislation around technology is woefully bad and behind in the US at least.