Your objections seem to be predicated on the assumption that the attempt to separate storage providers from application providers wouldn't be properly enforced.

Your objections seem to be predicated on the assumption that the attempt to separate storage providers from application providers wouldn't be properly enforced. Yes, obviously if Alphabet can just set up Google Cloud Storage and Google Cloud Apps and continue with business as usual, then this won't work. But what I'm suggesting would be a functioning regulatory regime: An independent authority who classifies cloud providers as utilities, writes regulations specifying standards of interoperability, hears complaints from people and businesses and acts to enforce them. Antitrust regulation that stops collusion between service and application providers, and prevents companies or individuals owning a controlling stake in both. And the major difference I see in contrast to railways is digital infrastructure is not limited in they same way physical infrastructure is. So long as there's only one set of tracks, you can never have a functioning market running trains on them, and it's impossible to build a second set. But while the capital costs of setting up a new data centre are large, they are still within the realm of possibility for many large companies.