A landmark class action lawsuit has been filed against Microsoft in the UK, accusing the company of overcharging for its Windows Server software, a critical tool in cloud computing operations. Regulation expert Dr. Maria Luisa Stasi filed the claim on behalf of thousands of UK businesses, seeking more than £1 billion in compensation.
The lawsuit alleges Microsoft exploited its dominant market position to penalize businesses that chose rival cloud platforms such as Amazon, Google, or Alibaba by charging them inflated licensing fees for Windows Server. According to the claim, these practices coerced firms into using Microsoft’s Azure cloud platform, stifling competition in the sector.
“Microsoft is punishing UK businesses and organisations for using alternative cloud services, forcing them to pay more for Windows Server,” said Dr. Stasi. “This lawsuit aims to hold Microsoft accountable for anti-competitive behavior and return unfairly overcharged money to UK organizations.”
The claim highlights the disproportionate effect on small businesses, citing UK government data showing more businesses closed than opened in 2022. It argues that elevated costs on essential cloud services contribute to financial pressures on smaller firms, undermining their sustainability and growth.
The legal action comes amid broader scrutiny of Microsoft and other tech giants by the UK’s Competition and Markets Authority (CMA), which is investigating the cloud computing industry. Rival firms, including Google, have accused Microsoft of anti-competitive licensing practices that raise costs for competitors, a claim Microsoft has denied.
In its response to the CMA, Microsoft stated that its licensing terms “do not meaningfully raise cloud rivals’ costs” and dismissed allegations of anti-competitive intent.
This case, filed on an “opt-out” basis, automatically includes all affected UK businesses unless they choose to exclude themselves. It joins a growing trend of class actions against major tech firms in the UK since the introduction of such claims in 2015, including ongoing lawsuits against Facebook and Google.
Given the complexity of such cases, a resolution is likely years away. However, if successful, the lawsuit could result in substantial compensation for UK businesses and potentially reshape the competitive landscape in the cloud computing sector.
