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Microsoft Must Face Mass Lawsuit in UK Over Cloud Software Pricing

By  |  April 21, 2026

A London tribunal has ruled that Microsoft must face a large-scale lawsuit accusing the company of overcharging thousands of British businesses for using its Windows Server software on competing cloud platforms, according to Reuters.

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    The case has been brought by competition lawyer Maria Luisa Stasi on behalf of nearly 60,000 businesses that rely on Windows Server while operating on cloud services offered by rivals such as Amazon, Google, and Alibaba. The claim could be worth as much as 2.1 billion pounds ($2.8 billion), per Reuters.

    Lawyers representing the claimants argued during a hearing last year that Microsoft imposed higher wholesale licensing fees for Windows Server when it was used outside its own Azure cloud platform. These higher costs were then passed on to customers, effectively making Azure a more financially attractive option compared to competing services like Amazon Web Services and Google Cloud.

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    Microsoft has pushed back against the allegations, arguing that the lawsuit does not present a clear or workable method for calculating damages and should therefore be dismissed. However, the Competition Appeal Tribunal in London rejected that argument at this stage, allowing the case to proceed toward trial, an early procedural step in the legal process, according to Reuters. The company did not immediately respond to requests for comment following the ruling.

    Read more: UK Regulator Reopens Probe Into Microsoft’s Cloud Licensing Practices

    In a statement, Stasi described the tribunal’s decision as “an important moment for the thousands of organisations impacted by Microsoft’s conduct,” highlighting the potential scale of the case.

    Microsoft has defended its business model, stating that its vertically integrated approach—where Windows Server is used within Azure while also being licensed to competitors—can actually promote competition. Per Reuters, the company argued during earlier hearings that this structure benefits the broader cloud market.

    The lawsuit comes amid increasing scrutiny of Microsoft’s cloud practices by regulators in multiple regions. Authorities in the United Kingdom, Europe, and the United States are all examining how major technology firms operate in the rapidly growing cloud computing sector, according to Reuters.

    Last July, a panel from the UK’s Competition and Markets Authority (CMA) concluded that Microsoft’s licensing policies were harming competition by “materially disadvantaging AWS and Google,” per Reuters. Microsoft responded at the time by saying the findings overlooked the fact that “the cloud market has never been so dynamic and competitive.”

    Source: Reuters