AWS says enterprises are moving back on-prem – but does cloud repatriation really threaten hyperscalers?
The comments from AWS came as part of a hearing conducted by the UK’s competition watchdog


AWS has claimed to face competition from on-premises IT while defending the level of competition in the UK cloud market, according to a Competition and Markets Authority (CMA) hearing.
At the hearing, conducted as part of an ongoing investigation into the state of competition in the UK cloud industry, AWS refuted the perception that “once customers move to the cloud, they never return to on-premises,” claiming instead that the cloud giant “faces competition from on-premises IT.”
“AWS stated the market investigation's narrow focus on cloud services does not contextualize the role of those services within the IT services market,” the summary of the hearing said.
The hyperscaler provided examples of customers moving from the cloud back to on-premises systems, noting also that building a data center “requires significant effort” and so the fact that customers are doing so highlights the level of flexibility they have.
Reasons for making the move back to on-prem include the relocation of internal finances, the adjustment of technology access, and the increased ownership of resources, data, and security, AWS said.
In addition, AWS denied that the CMA’s evidence supports a “compelling theory of harm” on technical barriers, committed spend discounts, or egress fees, instead stating its opinion that the cloud market is fair.
“AWS told the CMA that it considers the competition between IT providers to be well-functioning and that cloud services meet the needs of customers both in the UK and globally in terms of pricing, innovation, product choice, variety, and quality,” the summary said.
Sign up today and you will receive a free copy of our Future Focus 2025 report - the leading guidance on AI, cybersecurity and other IT challenges as per 700+ senior executives
The firm reportedly told the CMA that the evidence “demonstrates customers can multi-cloud, switch between cloud providers when they want to and negotiate contract terms effectively with their existing providers.”
AWS explained that some customers “may tend to predominantly” use a single cloud provider to cut down operational costs and maintain a level of ease in training.
“Generally customers will decide on a workload-by-workload basis which cloud provider to use,” it claimed.
Looking forward, AWS stated that it would be “very difficult to restrict remedies to geographic subsets of customers” given that cloud services are delivered in a global context.
People familiar with the matter told ITPro that AWS’s reference to on-prem providers constituted a minimal part of the hearing.
They added that statistics within the report suggest that 15% of workloads are hosted in the cloud, thereby the hyperscaler does face competition with on-prem providers as either an alternative or an addition to the cloud.
Critics question AWS claims
Other cloud providers have hit out at AWS over the claims made in this hearing, with Civo CEO Mark Boost telling ITPro that the hyperscaler is overselling the issue of cloud repatriation.
“AWS implies that it is facing major competition from enterprises moving applications back on-premise, despite the effort this data migration requires. They overstate the extent of this phenomenon,” Boost said.
He accepted it was true, however, that “a number of cloud customers” are moving back on-prem owing to dissatisfaction with the offerings from major cloud providers.
“In the face of this, on-prem and private cloud solutions are a stronger guarantor of data sovereignty,” Boost said.
RELATED WHITEPAPER
“AWS’ suggestion that the CMA widen its cloud investigation to cover the IT services market as a whole will not change this. Expanding the scope so broadly at this stage will only dilute the investigation’s effectiveness,” he added.
Boost insisted that the CMA should remain focused on investigating practices unique to the cloud, such as unfair cloud credit schemes, rather than cloud customers looking to retain control of their data.

George Fitzmaurice is a former Staff Writer at ITPro and ChannelPro, with a particular interest in AI regulation, data legislation, and market development. After graduating from the University of Oxford with a degree in English Language and Literature, he undertook an internship at the New Statesman before starting at ITPro. Outside of the office, George is both an aspiring musician and an avid reader.
-
Using DeepSeek at work is like ‘printing out and handing over your confidential information’
News Thinking of using DeepSeek at work? Think again. Cybersecurity experts have warned you're putting your enterprise at huge risk.
-
Can cyber group takedowns last?
ITPro Podcast Threat groups can recover from website takeovers or rebrand for new activity – but each successful sting provides researchers with valuable data
-
Is AWS' cloud dominance waning? New stats show the hyperscaler's IaaS market share is decreasing while Microsoft and Google record gains
News AWS maintained its lead in the IaaS market last year, but its share decreased while Microsoft and Google recorded gains.
-
AWS says only Europeans will run its European Sovereign Cloud service
News The firm wants to reassure customers that sovereign really does mean sovereign
-
‘Misses the mark’: Microsoft, AWS hit out at CMA cloud competition report
News The CMA claims Microsoft and AWS are harming competition – the duo strongly disagree
-
US companies dominate the European cloud market – regional players are left fighting for scraps
News Synergy data shows EU providers hold just 15% of the market despite rise in AI and drive for cloud sovereignty
-
Three of the biggest announcements from AWS Summit New York
News AWS may be known as a cloud services provider, but its pivot to AI services has taken the limelight
-
AWS misses quarterly revenue expectations – but Andy Jassy is still upbeat
News Jassy highlighted a number of key areas of interest after AWS' quarterly earnings results
-
The Wiz acquisition stakes Google's claim as the go-to hyperscaler for cloud security – now it’s up to AWS and industry vendors to react
Analysis The Wiz acquisition could have monumental implications for the cloud security sector, with Google raising the stakes for competitors and industry vendors.
-
Abandoned S3 buckets could have caused a catastrophic supply chain attack – and all at a cost of just $400
News Researchers think they just uncovered what could’ve caused the mother of all supply chain attacks.