Legal Claim Against Microsoft Could Lead to Payouts for UK Businesses
Thousands of UK businesses may receive compensation if a legal claim filed against Microsoft proves successful. The case, led by regulatory expert Dr. Maria Luisa Stasi, accuses the tech giant of overcharging companies for its Windows Server software, which is widely used in cloud computing. Dr. Stasi is seeking over £1 billion in compensation on behalf of UK businesses.
The legal action has been brought on an “opt-out” basis, meaning that all UK organisations are automatically represented in the case unless they choose to opt out. This is a significant development, as it is one of the largest class action lawsuits to be filed in the UK. These types of claims, introduced in 2015, are still relatively new and lack a substantial legal precedent, making it difficult to predict how successful this case might be. A final outcome is likely years away.
The lawsuit is part of a broader investigation into the cloud computing industry, led by the UK’s Competition and Markets Authority (CMA). Cloud computing, which involves storing data online and accessing it from anywhere, is an essential part of modern business operations. Microsoft’s Azure platform, alongside competitors like Google and Amazon, plays a key role in the sector.
The controversy centers on Microsoft’s licensing practices. According to the claim, Microsoft has been charging higher fees for its Windows Server software to businesses that use cloud services from competitors such as Google, Amazon, and Alibaba. Google itself has raised concerns, arguing that Microsoft’s practices increase costs for rival companies and reduce their ability to compete. However, Microsoft has strongly denied these claims, stating that its licensing terms do not raise the costs for cloud rivals in a meaningful way.
Dr. Stasi’s legal action argues that small businesses have been particularly hard-hit by these practices. She pointed to data from the Office for National Statistics, which showed that more businesses closed than started in 2022. The lawsuit accuses Microsoft of using its pricing strategy to force businesses into using its own cloud service, Azure, and to restrict competition in the sector.
Microsoft’s behavior is being challenged as anti-competitive, with Dr. Stasi seeking to force the company to disclose exactly how much UK businesses have been overcharged and to return the funds to those affected.
This case, one of many class action lawsuits emerging in the UK against large tech companies, highlights ongoing concerns about competition in the cloud computing industry. As the CMA investigates the sector and the lawsuit progresses, the future of cloud software pricing in the UK may be significantly affected.
