Microsoft Faces £1bn Lawsuit For Cloud Licencing Damages

Uploaded on 2024-12-06 in NEWS-Cybersecurity News, FREE TO VIEW, BUSINESS-Services-IT & Telecoms

A major legal case has been launched against Microsoft in the UK, with claims that the technology giant overcharged thousands of businesses and organisations using rival cloud computing platforms. Many businesses could receive substantial compensation the claim filed against Microsoft is successful.

The claim is led by competition lawyer Dr Maria Luisa Stasi, a regulation expert at Tilburg University and presently Head of Law and Policy for digital markets at human rights organisation ARTICLE 19. She claims that Microsfost has overcharged companies for its Window Server software, used in cloud computing.

The lawsuit, filed with the UK Competition Appeal Tribunal, accuses Microsoft for imposed higher licencing costs on companies using competing cloud services such as Amazon Web Services (AWS), Google Cloud Platform, and Alibaba Cloud. Dr Stasi said: “Put simply, Microsoft is punishing UK businesses and organisations for using Google, Amazon and Alibaba for cloud computing by forcing them to pay more money for Windows Server...

“By doing so, Microsoft is trying to force customers into using its cloud computing service Azure and restricting competition in the sector...

“This lawsuit aims to challenge Microsoft’s anti-competitive behaviour, push them to reveal exactly how much businesses in the UK have been illegally penalised, and return the money to organisations that have been unfairly overcharged.” Stasi concludes

This action has been brought on an "opt-out" basis, meaning UK organisations are all being represented to begin with, unless they wish not to be.

The claim is the latest class action lawsuit to be filed at the UK's Competition Appeal Tribunal against big technology firms, including Google and Facebook. These types of claims were first introduced in the UK less than 10 years ago and there is very little case-law to indicate how likely it is to be successful - it may take years for an outcome.

Cloud computing is also now a critical part of how many businesses operate and typically, this means either using Microsoft's Azure platform or entering into agreements with alternative providers like Amazon and Google, who then may licence software from Microsoft.

This isn’t the first time that Microsoft has been criticised over its software pricing strategy, the company has also been criticised for imposing technical limitations designed to make it costly to switch providers.

Image: Salvatore De Lellis

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