Amazon cloud unit draws antitrust scrutiny from FTC

One issue the FTC could look at is whether Amazon has an incentive to discriminate against software companies that sell their products to clients of AWS, while at the same time competing with Amazon. The fear is that Amazon could punish the companies that work with other cloud providers and favor those that it works with exclusively.

The FTC’s investigation of Amazon began during the Trump administration under former chairman Joe Simons. The agency has pursued inquiries about Amazon’s retail business as well as the cloud division, Bloomberg has reported. The renewed outreach to companies shows the probe is active.

Amazon has provided information to the FTC in response to the agency’s requests, according to a person familiar with the matter.

Amazon and the FTC didn’t respond to requests for comment.

The company filed a petition with the agency in June seeking Khan’s recusal from antitrust enforcement decisions against Amazon. The company argues that her past criticism of the company shows she is biased.

AWS dominates the market for foundational cloud-computing technology that provides the storage and computing power needed to run applications. Amazon held 41% of the cloud-computing market in 2020, followed by Microsoft Corp.’s Azure at 20%, according to an estimate by research firm Gartner.

Amazon also sells an array of products that run on top of those basic services, such as databases, machine-learning tools and data-warehousing products. It competes with hundreds of other software companies large and small that offer similar products.

Cloud computing companies like Amazon, Microsoft and Oracle Corp. are vying for lucrative government contracts to provide cloud services to agencies including the Defense Department and the National Security Agency.