UK and Global Legislation on AI and Cloud: What MSPs Need to Know

Two legislative moves in the UK to track.  

The U.K.’s regulatory agency for telecommunications, Ofcom, has recommended that competition authorities examine established cloud infrastructure business practices. Ofcom’s report highlights concerns about customer choice, excessive egress fees, technical differentiation, and lock-in contracts. The report suggests interventions such as transparency about compatibility issues, exploring direct data center connections, and opening APIs to third-party software. The U.K.’s Competition and Markets Authority will investigate and make decisions on these recommendations by April 2025.  Of particular note, it’s Microsoft and Amazon being examined.  

And since I’m taking a moment on legislation, I want to highlight an Insider summary of the state of AI.   The EU will likely be the first to enact generative AI regulation, while China takes a more restrictive stance. The US has relied on industry experts, and the UK is assessing AI as it progresses. Brazil categorizes AI tools by risk and will ban excessive risk ones. China has enacted regulations on recommendation algorithms and deep fakes and is now looking to regulate generative AI.

Different vendors have different approaches to defending customers from IP lawsuits. Some vendors pledge to financially and otherwise support customers who face copyright litigation, while others have policies that shield themselves from liability, leaving customers to handle legal fees. The terms of service agreements for most generative AI tools are written in legalese, but it is clear that not every vendor is willing to take a strong stance in protecting customers. Some vendors, however, do offer indemnification and defense against IP claims.

As the use of generative AI continues to grow, the issue of copyright infringement and vendor responsibility remains a concern.   See the previous story about the need to deliver to industry and customers the right solutions, and more additionally, navigate the regulatory compliance landscape here.     The variance in vendor policies regarding IP lawsuits necessitates careful vendor selection and contract review by MSPs. Those who choose vendors that offer strong legal protection could use it as a differentiating factor in their service offerings.

Seeing the UK move into potential anti-trust laws is interesting to me.   Those will go into the 2025 bingo card, but at least something to track.   Since Microsoft and Amazon are being examined, MSPs should proactively reevaluate their service offerings and contracts. They could face changes in terms, costs, and compliance requirements, especially if the Competition and Markets Authority takes a strong stance on issues like egress fees or contract lock-ins.