Microsoft facing $2.8 billion UK lawsuit for overcharging 60,000 businesses using Microsoft Server on other clouds — Azure users allegedly received lower wholesale pricing

Microsoft is currently facing a lawsuit from the UK Competition Appeals Tribunal (CAT) after it was alleged that the company is charging higher wholesale prices for Windows Server for customers using Amazon AWS, Google Cloud, or Alibaba Cloud. This makes Azure, Microsoft’s cloud services provider, cheaper than the competition as its competitors have to eventually pass on the increased costs to their clients, reports Reuters. Competition lawyer Maria Luisa Stasi filed the case at the Competition Appeal Tribunal in late 2025, representing nearly 60,000 businesses that used Microsoft software on competing cloud services, with her team suggesting that the claim is worth about USD 2.8 billion (or about GBP 2.1 billion).

The company argued that Stasi did not show a concrete way of computing for any alleged losses, so the case should be thrown out. However, the London tribunal certified the case, and it’s now proceeding to trial. Microsoft is planning to appeal the decision and told the publication, “We also dispute the underlying allegations by the class representative, and today’s decision makes no final determination on those claims.”

During a previous hearing, Microsoft said that its strategy of integrating Windows Server with Azure while also licensing it to rivals will help competition. However, the British Competition and Markets Authority (CMA) discovered that this licensing practice is “materially disadvantaging AWS and Google” in mid-2025, with the government body opening another investigation into the company’s licensing practices. Other regulators in the U.S. and Europe are also looking into Microsoft and other cloud computing firms. Some sources said that the Federal Trade Commission (FTC) started scrutinizing claims late last year that the company has put punitive licensing terms in its productivity suite that make it harder for customers to switch to rival platforms from Azure.

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This isn’t the only legal trouble that Microsoft faces in the UK. The company is currently appealing a ruling handed down by the same authority, which said that reselling perpetual licenses, including those of Microsoft Office and Windows, is legal and valid. This stemmed from a lawsuit by ValueLicensing, after it argued that Microsoft’s contract, which prohibited reselling of licenses issued before, is against the law. It follows a similar argument in a UsedSoft complaint filed against Redmond more than a decade ago, but Microsoft used a copyright infringement argument this time. It said that Word and other apps contained graphics that are protected by creative work, which the UK tribunal rejected.

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