Microsoft Faces $2.3bn UK Lawsuit Over Alleged Cloud Overcharging

Microsoft is facing a £1.7 billion ($2.3 billion) class action lawsuit in the United Kingdom over allegations it abused its market dominance to overcharge customers.

The case, filed by digital markets regulation expert Maria Luisa Stasi, represents about 59,000 businesses and organisations across Britain. It centres on claims that Microsoft imposed unfair costs on customers using its Windows Server software on rival cloud platforms.

According to Stasi, the company’s conduct has had significant financial consequences for both public and private sector organisations over an extended period.

On Tuesday, judges at the Competition Appeal Tribunal cleared the case to move forward, stating it has a “reasonable prospect of success.” The tribunal noted that Microsoft is accused of leveraging its dominance in the server operating system market to undermine competition in cloud computing services.

If the claim succeeds, compensation is estimated to range between £1.7 billion and £2.1 billion.

Microsoft, however, has pushed back against the ruling, confirming plans to appeal. A company spokesperson said the decision does not amount to a final judgment and that the firm strongly contests the allegations.

Meanwhile, regulators in the UK and European Union are also scrutinising Microsoft’s cloud licensing practices, including whether it should be designated with “strategic market status,” a move that would impose stricter competition rules.