Google Cloud’s surprise removal of certain EU and UK data transfer fees dramatically reshapes the short-term economics of multicloud strategies and adds fresh momentum to regulators’ efforts to break hyperscaler lock‑in. (reuters.com)
The European Union’s Data Act is the legal backdrop for this move: the regulation formally entered into force in January 2024 and becomes applicable on 12 September 2025, creating new obligations intended to make it easier for organisations to access, move and use data across platforms and suppliers. Key transitional rules allow providers to recover switching and egress costs “at cost” up until a later ban on certain switching charges, but the Act’s application window means providers must be ready to comply with new interoperability and contractual transparency obligations now. (commission.europa.eu)
At the same time, UK competition authorities have concluded that the cloud market suffers from high concentration and practices that limit customer mobility — notably egress fees and licensing terms that can disadvantage rival clouds. The UK Competition and Markets Authority (CMA) has explicitly flagged issues such as egress charges and Microsoft’s licensing practices as barriers to switching and competition. (cnbc.com)
Google’s public comments — reported by major wires and trade press — specifically name Jeanette Manfra, Senior Director for Global Risk and Compliance at Google Cloud, as the author of the blog post describing the change. The offer is framed as a simple, opt‑in solution for customers who distribute processing or storage across providers, a typical multicloud architecture used to increase resilience and access best-of-breed services. (reuters.com)
Note of caution: the coverage relies on Google’s blog post as reported by news outlets; at the time of writing the explicit, named “Data Transfer Essentials” product page was not clearly discoverable in all official Google content indexes, although Google’s documentation and transfer tooling (Storage Transfer Service, data movement pages) do exist and underpin how transfers are implemented technically. Readers should validate the precise product terms with official Google Cloud support or sales contacts. (cloud.google.com)
The EU Data Act aims to reduce these frictions by forcing more transparency and by setting minimum technical interoperability rules. Importantly, the regulation sets layered timelines — the Act entered into force on 11 January 2024 and becomes applicable on 12 September 2025 — and includes transitional allowances that affect how and when egress charges can be recovered or removed. Those deadlines create a window in which providers can adjust commercial terms. (eur-lex.europa.eu)
Google’s own transfer tooling and managed services (Storage Transfer Service, Transfer Appliance, interop docs) demonstrate there are multiple technical ways to move data — some fully managed, some self‑hosted — and not all are costed the same. In practice, network topology, peering arrangements, and regional ingress/egress pricing variations remain material to the migration bill even if headline egress fees are waived for certain scenarios. Customers should therefore treat “free transfer” headlines as a starting point for technical validation rather than a blanket promise. (cloud.google.com)
Rivals may react in three main ways:
Organisations that are contemplating multicloud deployments or migrations should use the current market momentum to extract concrete, written commitments from providers, validate transfer paths technically, and incorporate the Data Act’s timelines into procurement and legal planning. The next 12–18 months of regulatory guidance, provider policy updates, and competitive adjustments will determine whether this moment results in durable lower‑friction portability — or whether new forms of commercial lock‑in simply replace old ones. (reuters.com)
Source: iTnews Google scraps some cloud data transfer fees in EU and UK
Background
The European Union’s Data Act is the legal backdrop for this move: the regulation formally entered into force in January 2024 and becomes applicable on 12 September 2025, creating new obligations intended to make it easier for organisations to access, move and use data across platforms and suppliers. Key transitional rules allow providers to recover switching and egress costs “at cost” up until a later ban on certain switching charges, but the Act’s application window means providers must be ready to comply with new interoperability and contractual transparency obligations now. (commission.europa.eu)At the same time, UK competition authorities have concluded that the cloud market suffers from high concentration and practices that limit customer mobility — notably egress fees and licensing terms that can disadvantage rival clouds. The UK Competition and Markets Authority (CMA) has explicitly flagged issues such as egress charges and Microsoft’s licensing practices as barriers to switching and competition. (cnbc.com)
What Google announced — the essentials
Google unveiled a offering called Data Transfer Essentials that, according to the company’s communications quoted by multiple news outlets, waives data transfer fees for organisations running workloads in parallel across two or more cloud platforms in the EU and UK. The announcement was positioned as going beyond the minimum legal requirement under the Data Act to charge only “at cost,” because Google’s offer is available at no cost for qualifying multicloud scenarios. (reuters.com)Google’s public comments — reported by major wires and trade press — specifically name Jeanette Manfra, Senior Director for Global Risk and Compliance at Google Cloud, as the author of the blog post describing the change. The offer is framed as a simple, opt‑in solution for customers who distribute processing or storage across providers, a typical multicloud architecture used to increase resilience and access best-of-breed services. (reuters.com)
Note of caution: the coverage relies on Google’s blog post as reported by news outlets; at the time of writing the explicit, named “Data Transfer Essentials” product page was not clearly discoverable in all official Google content indexes, although Google’s documentation and transfer tooling (Storage Transfer Service, data movement pages) do exist and underpin how transfers are implemented technically. Readers should validate the precise product terms with official Google Cloud support or sales contacts. (cloud.google.com)
How Google’s move compares with Microsoft and AWS
- Microsoft: In late August 2025 Microsoft published guidance (dated 26 August 2025) explaining an at‑cost data transfer approach for EU customers moving data between Azure and other cloud providers in parallel scenarios. Microsoft’s documentation sets out a support‑request process customers must follow to qualify for refunds or credits and lists eligibility conditions (billing address in the EEA, same‑organisation processing at destination, supported ISP paths). In short, Microsoft implemented a procedure to ensure transfers are charged only at cost for qualifying cases rather than offering broad fee waivers. (learn.microsoft.com)
- AWS: Amazon Web Services states that EU customers can request reduced data transfer rates for eligible use cases and provides FAQ guidance on discounts and eligibility. AWS’s approach is more case‑by‑case, with contact through customer support for reductions rather than a blanket free‑transfer product. (aws.amazon.com)
Why regulators and customers care: the competition and switching problem
For many organisations, data egress fees have been a practical barrier to switching or operating multicloud architectures. Egress — the cost of moving data out of a cloud provider — can materially increase migration bills and disincentivise third‑party processing or failover architectures. Regulators have argued that these pricing and contractual patterns create effective lock‑in, reducing competition and harming customers. The CMA’s market investigation concluded that Microsoft and AWS hold very large shares of UK cloud spend, and raised concerns that licensing and commercial practices further entrench market power. (cnbc.com)The EU Data Act aims to reduce these frictions by forcing more transparency and by setting minimum technical interoperability rules. Importantly, the regulation sets layered timelines — the Act entered into force on 11 January 2024 and becomes applicable on 12 September 2025 — and includes transitional allowances that affect how and when egress charges can be recovered or removed. Those deadlines create a window in which providers can adjust commercial terms. (eur-lex.europa.eu)
Technical scope and practical limits of fee waivers
The devil is in the definitions and the mechanics. Google’s reports specify the waiver applies to workloads processed “in parallel” across two or more cloud platforms and is tied to the same organisation moving or processing the data. That language excludes a range of scenarios that customers commonly face, such as:- CDN or public internet delivery use cases.
- Transfers between accounts or organisations.
- Some specialised network paths (private interconnects or premium transit) that may not be supported by the provider’s standard ISP paths.
Google’s own transfer tooling and managed services (Storage Transfer Service, Transfer Appliance, interop docs) demonstrate there are multiple technical ways to move data — some fully managed, some self‑hosted — and not all are costed the same. In practice, network topology, peering arrangements, and regional ingress/egress pricing variations remain material to the migration bill even if headline egress fees are waived for certain scenarios. Customers should therefore treat “free transfer” headlines as a starting point for technical validation rather than a blanket promise. (cloud.google.com)
Market dynamics: winners, losers and the short‑term impact
Google’s unilateral no‑cost stance (per public reports) is a clear competitive gambit. It reduces a large friction point for customers considering multicloud and positions Google positively with European regulators. That has several immediate effects:- Commercial pressure on rivals. Microsoft and AWS now face pressure to match or better Google’s terms for EU/UK customers to avoid losing multicloud deals or being painted as slow to comply with the Data Act’s spirit. Reuters and trade press have highlighted this dynamic and reported rival posture differences. (reuters.com)
- Procurement leverage for customers. Enterprise buying teams can now use public commitments to secure improved transfer terms, credits, or bespoke network arrangements during renewal negotiations. Procurement teams should extract firm contractual commitments (SLAs, credits, process timelines) rather than relying on press reports.
- Regulatory optics. Google’s move strengthens the narrative regulators want to see — that hyperscalers must make switching feasible — and could influence forthcoming standard contractual clauses or non‑binding model clauses the Commission plans to recommend around the Data Act’s application in September 2025. (digital-strategy.ec.europa.eu)
Practical guidance for IT teams evaluating multicloud now
- Get the provider promise in writing. Public statements are helpful but commercial commitments must be reflected in contract amendments, customer support confirmations, or billing credits. Microsoft’s documentation shows the credit process requires formal support tickets and validation. Ask for the exact eligibility criteria and timelines. (learn.microsoft.com)
- Map your traffic and topology. Understand where traffic originates and terminates, whether it will traverse public internet, peering links or premium transit. Different transfer methods (Storage Transfer Service, peerings, Transfer Appliance) have different cost and performance profiles. Google’s Storage Transfer documentation lists options and use cases. (cloud.google.com)
- Validate performance and security. Fee waivers don’t change latency, throughput, or encryption requirements. Run pilot transfers to validate throughput, failure and retry behavior, and integrity checks.
- Quantify total migration TCO (total cost of ownership). Include labour and project management, temporary dual‑running costs, testing, reconfiguration of DNS and identity, and any third‑party tools or consultants. Egress line items are only one portion of a migration budget.
- Consider supplier lock‑in beyond egress. Licensing models (for example, Windows Server or database licences) and proprietary service dependencies (managed databases, specialised AI primitives) can create lock‑in even if network fees are low or waived. The CMA has highlighted such licensing effects as a core competition concern. (cnbc.com)
Potential risks and regulatory caveats
- Fine print and changing policies. Providers can modify commercial programs; Microsoft’s at‑cost program explicitly warns that policies may change. Customers should negotiate irrevocable contractual assurances where possible and monitor provider notices. (learn.microsoft.com)
- Limited scope for the waiver. Blanket headlines often obscure qualification clauses. Google’s reported waiver focuses on same‑organisation, in‑parallel processing cases and may exclude CDN, cross‑customer transfers, or edge streaming scenarios. Ensure your use case matches the provider’s definition.
- Hidden network costs. Even when list egress fees are waived or credited, underlying ISP transit, cross‑border peering or specialised transit may carry costs that a provider’s “no‑cost” promise does not absorb. Where providers rely on third‑party ISPs for the transfer path, customers should insist on clarity about which party bears those charges.
- Regulatory enforcement and interpretation. The Data Act has phased application dates and gives the Commission levers to recommend contractual model terms. The law’s enforcement and the exact interpretation of “at cost” versus “waived” could become the subject of enforcement actions or litigation. Market participants should watch the Commission’s model clauses and the CMA’s follow‑on work closely. (digital-strategy.ec.europa.eu)
- Strategic reaction by rivals. Providers that choose not to fully match free transfer offers may instead double down on non‑transferable differentiation (proprietary services, integrated AI features, pricing advantages for in‑ecosystem licensing). That could preserve lock‑in in forms unrelated to egress fees, reshaping competitive dynamics in subtler ways.
What this means for the business models of hyperscalers
Removing or reducing egress fees for an important subset of use cases reduces one revenue stream but also removes a significant political and reputational liability. Egress pricing has been a long-standing complaint used by competitors and regulators to accuse hyperscalers of anti‑competitive lock‑in. By waiving fees in high‑visibility markets (EU and UK), Google achieves both a customer acquisition signal and a regulatory‑friendly stance. The question for investors and industry strategists is whether volume, new paid services, or net customer acquisition will offset any near‑term revenue losses from egress charges.Rivals may react in three main ways:
- Match or beat Google’s terms in the same markets to avoid churn. Microsoft’s already-documented at‑cost process suggests a willingness to comply with the Data Act’s letter; whether Microsoft broadens the program into a coarse or free model is a distinct commercial decision. (learn.microsoft.com)
- Differentiate via bundling and licensing. Providers may try to lock value into managed services, integrated AI tooling or preferential licensing that remains cheaper to run on their own cloud than elsewhere. The CMA has warned that licensing arrangements already raise competition concerns. (cnbc.com)
- Focus on infrastructure investment and peering economics. Providers may invest more aggressively in network peering and edge regions to lower real transfer costs, enabling more sustainable low‑fee transfer models over time.
Strategic takeaways — how to act this quarter
- Reassess migration and multicloud pilots now. The combination of Google’s public free‑transfer posture and the Data Act’s applicability on 12 September 2025 means procurement and engineering teams should re‑run cost models with the new options reflected.
- Negotiate explicit contract amendments. Public offers are valuable bargaining chips, but only written contract terms and bill credits bind providers to a customer’s specific scenario.
- Test operational portability. Run a proof‑of‑concept migration that validates not only raw transfer but also application portability, licensing portability and operational readiness (monitoring, identity, security controls).
- Watch regulatory guidance. The Commission and national regulators will publish model clauses and FAQs in the coming months that will materially affect contractual templates used by cloud customers across the EU and UK. Plan to update procurement templates and legal checklists accordingly. (digital-strategy.ec.europa.eu)
Conclusion
Google’s reported decision to waive certain multicloud data transfer fees in the EU and UK marks a notable shift in hyperscaler commercial behaviour at a critical regulatory inflection point. It aligns with the aims of the EU Data Act and strengthens negotiating leverage for customers, but it is not a silver bullet for portability or vendor lock‑in. Practical portability requires careful technical planning, contractual clarity and attention to the many non‑egress elements of supplier lock‑in — notably licensing and proprietary services.Organisations that are contemplating multicloud deployments or migrations should use the current market momentum to extract concrete, written commitments from providers, validate transfer paths technically, and incorporate the Data Act’s timelines into procurement and legal planning. The next 12–18 months of regulatory guidance, provider policy updates, and competitive adjustments will determine whether this moment results in durable lower‑friction portability — or whether new forms of commercial lock‑in simply replace old ones. (reuters.com)
Source: iTnews Google scraps some cloud data transfer fees in EU and UK
