UK Firms Say Tech Giants Are Restricting Competition
The market power of the world’s largest technology companies is becoming a bigger barrier to growth for technology-dependent UK businesses than access to finance or skilled workers, according to new research from the Institute for Public Policy Research.
Polling carried out for IPPR by Opinium found that 79% of surveyed businesses that rely heavily on digital platforms and infrastructure are concerned that large technology companies can use their power to restrict competition.
The firms ranked Big Tech market power as their second-largest constraint on growth, ahead of access to finance and talent. More than one-third said they had decided against offering a product during the past two years because a major technology company dominated the relevant market.
Dependence on existing providers was another problem. Some 68% of respondents said moving away from their main technology provider would be costly, disruptive or impossible, while half said their businesses could continue operating normally for only a matter of days if access to that provider disappeared.
The findings point to a problem that reaches beyond how much businesses pay for technology. They suggest dependence on a small number of cloud, search and software companies can influence whether smaller firms launch products, how easily they can use rival suppliers and their ability to compete with companies that also control key digital infrastructure.
IPPR said 72% of businesses, averaged across three competition measures tested in the survey, believed stronger measures could allow them to lower prices or offer better products.
The think tank highlighted the concentration already visible across several parts of the UK technology sector. Google accounts for more than 90% of UK searches, while Microsoft and Amazon Web Services each account for roughly 30% to 40% of customer spending on cloud services.
Those cloud figures broadly match findings from the Competition and Markets Authority. Its cloud investigation concluded in July 2025 after finding competition problems in the market and identifying AWS and Microsoft as the two largest providers. The inquiry found barriers that made switching or using several providers harder, including data-transfer charges, interoperability problems and Microsoft’s software licensing practices.
The CMA has since taken a different route on different parts of the market. In March, it said Microsoft and Amazon had taken steps to reduce cloud egress charges and improve interoperability, while the regulator continued discussions over further changes. At the same time, the CMA chose to open a Strategic Market Status investigation into Microsoft’s wider business software ecosystem.
That investigation formally began in May and covers software used by hundreds of thousands of UK companies and public-sector organisations, including Windows, Microsoft 365, Teams and products increasingly tied to Copilot. The CMA is examining issues including bundling, interoperability, default settings and whether rival AI products can integrate effectively with Microsoft’s software.
Search is further ahead in the regulatory process. Google was designated as having Strategic Market Status in general search and search advertising in October 2025. The CMA followed this year with requirements covering areas including fair ranking, publisher treatment and portability of search data.
Those powers come from the Digital Markets, Competition and Consumers Act. The UK’s digital competition regime took effect on Jan. 1, 2025, giving the CMA the ability to impose tailored rules on companies designated as having Strategic Market Status rather than relying only on traditional competition cases after problems have developed.
IPPR argues that the rapid spread of artificial intelligence makes faster enforcement more important. British AI companies may raise money and build strong products but still depend on foreign-owned cloud infrastructure, software ecosystems, app distribution and search channels to reach customers.
The think tank wants the government to issue a new strategic steer making competition in digital markets a central part of its growth policy, while protecting the CMA’s independence. It also wants faster competition action in cloud computing, continued scrutiny of Google’s search business as AI changes how people find information, and greater support for UK technology companies trying to scale.
Roa Powell, senior research fellow at IPPR and author of the report, said Big Tech dominance was making it harder for new companies to innovate and grow, adding that stronger competition could bring “more choice, lower prices and better products.”
Which? policy and advocacy director Rocio Concha backed the call, arguing that more competitive digital markets could raise investment and innovation while giving consumers greater choice.
Why AI Turns Competition Policy Into Growth Policy
There is an important difference between saying Britain lacks successful technology companies and saying British technology companies operate inside markets controlled by someone else.
The second problem is harder to solve with traditional startup policy.
A government can improve access to venture capital, visas, research funding and university talent. But a company that successfully gets through all those hurdles may still discover that its computing runs on AWS or Azure, its customers work inside Microsoft software, its mobile product needs an Apple or Google ecosystem and much of its customer acquisition depends on Google.
That makes competition policy part of industrial policy.
The most revealing IPPR finding may therefore be the number of businesses that say they abandoned products because of an incumbent’s dominance. Financing constraints can stop a company from building something. Platform power can make a company decide that building it is not commercially worthwhile in the first place.
AI could intensify that problem because the technology is unusually dependent on infrastructure. Training and running advanced models requires computing power, data centres, developer tools and access to customers. A British AI startup does not necessarily compete with a cloud provider directly, but the economics of that cloud platform can decide how cheaply it can operate and how easily customers can switch to it.
There is a counterargument regulators cannot ignore. Large integrated technology ecosystems became popular partly because they work. Bundling software, identity, security, storage and cloud infrastructure can reduce complexity for businesses. Scale can also bring reliability, security investment and lower unit costs.
Breaking integration simply because a company is large could create new costs without producing a strong competitor.
That is why switching and interoperability may matter more than company size alone. A healthy digital market does not require every business to avoid Microsoft, AWS or Google. It requires businesses to have a credible alternative when prices rise, terms worsen or a better product appears.
The UK’s new regime is designed for that type of targeted intervention. Rather than immediately breaking companies apart or imposing one universal rule, the CMA can set requirements for specific activities after an SMS designation.
But speed matters.
The government’s existing 2025 strategic steer already tells the CMA to support growth and investment while acting independently, swiftly and proportionately. The regulator’s own 2026-2029 strategy also puts economic growth alongside competition and consumer protection.
The dispute, then, is less about whether competition supports growth and more about how aggressively that idea should be applied to digital infrastructure.
AI makes the timing harder. Regulators that intervene too early can write rules around markets that are still changing. Regulators that intervene too late may discover that network effects, bundled products and customer dependence have already made new competition extremely difficult.
The IPPR polling suggests many businesses believe the second risk is becoming the bigger one.