Microsoft is facing a £1bn class action lawsuit in the UK, alleging that it overcharged thousands of UK businesses for its Windows Server software used in cloud computing. The lawsuit, led by regulation expert Dr. Maria Luisa Stasi, could result in substantial payouts if successful.
Dr. Stasi claims that Microsoft has been overcharging companies for its Windows Server software, which is crucial for cloud computing. The lawsuit argues that these overcharges have unfairly penalized businesses, especially small firms, by forcing them to pay more if they use cloud services from Microsoft’s competitors like Google, Amazon, and Alibaba. This practice is alleged to push customers towards Microsoft’s own Azure cloud service, restricting competition.
The case is filed on an “opt-out” basis, meaning all UK businesses are automatically included unless they opt out. The lawsuit emphasises the disproportionate impact on small businesses, which are already struggling with high costs and competitive pressures. The legal action aims to hold Microsoft accountable for its pricing practices and seek compensation for the affected businesses.
This lawsuit comes amid a broader investigation by the UK’s Competition and Markets Authority (CMA) into the cloud computing industry. The CMA is examining whether the licensing practices of major tech firms like Microsoft are raising costs for rivals and stifling competition. Google’s statement to the CMA in June highlighted concerns that Microsoft’s licensing terms are designed to weaken competitors’ ability to compete effectively.
Microsoft has strongly denied the allegations, stating that its licensing terms do not significantly raise costs for cloud rivals but has yet to comment on the latest lawsuit.
The outcome of this lawsuit could have far-reaching implications for the cloud computing industry and the regulatory landscape for big tech firms in the UK. If successful, it could lead to significant changes in how software licensing is handled and ensure a more competitive market for cloud services.