Microsoft sued for bilking customers on competing clouds • The Register

Microsoft has been sued within the UK to the tune of greater than £1 billion over claims Redmond has been overcharging companies for Home windows Server licenses used on competing cloud platforms. 

The lawsuit, filed as we speak with the UK’s Competitors Attraction Tribunal by competitors lawyer Maria Luisa Stasi by means of the agency Scott+Scott, said the grievance is on behalf of the 1000’s of UK companies and organizations that had been allegedly overcharged by Microsoft when buying licenses for Home windows Server on AWS, Google Cloud Platform and Alibaba Cloud. The £1 billion determine is what affected companies are collectively owed in compensation for overcharges, in response to the submitting. 

“Put merely, Microsoft is punishing UK companies and organisations for utilizing Google, Amazon and Alibaba for cloud computing by forcing them to pay extra money for Home windows Server,” stated Stasi, a lawyer representing the alleged victims of Microsoft’s extra pricing scheme.

Whereas a spokesperson for Scott+Scott advised us specifics of the overage fees aren’t obtainable at this level, with the go well with nonetheless below assessment by the Tribunal, the agency’s assertion does point out that the overcharges had been sufficient {that a} small enterprise can be paying extra for licensing Home windows Server on AWS, GCP or Alibaba than in the event that they merely ditched competitor cloud internet hosting for Azure. 

“This lawsuit goals to problem Microsoft’s anti-competitive behaviour, push them to disclose precisely how a lot companies within the UK have been illegally penalised, and return the cash to organisations which have been unfairly overcharged,” Stasi added. 

Scott+Scott defined additional that Microsoft is aware of how reliant companies within the UK are on merchandise like Home windows Server, and makes use of that market dominance to extract larger costs from prospects who refuse to easily abandon rivals for its personal providers. 

“Microsoft is by far the dominant participant in desktop working techniques with a market share of between 70-80%, in response to the CMA [Competition and Markets Authority],” the agency stated. 

Cease me in case you’ve heard this one …

This may be a primary try and claw damages out of Redmond for its alleged ripping off of consumers utilizing Microsoft merchandise on rivals’ clouds, but it surely’s hardly the primary such grievance the tech large has handled. 

UK telecom regulator Ofcom referred each Amazon and Microsoft to the CMA in October 2023 for investigations into potential anti-competitive practices. This referral adopted findings earlier within the yr that raised issues about unfair software program licensing phrases, with a big give attention to Microsoft.

A part of the various complaints the CMA stated it obtained included – you guessed it – discriminatory pricing of Microsoft merchandise on clouds apart from Azure.

Microsoft additionally settled a complaint from the Cloud Infrastructure Service Supplier of Europe (CISPE) commerce group filed with the European Fee over the summer time for someplace within the 10-30 million Euro range. That case, unsurprisingly, additionally needed to do with Microsoft imposing unfair licensing phrases or charges to different cloud suppliers to run Microsoft software program. 

Google, which tried and failed to get CISPE to reject the settlement with Microsoft earlier than going its personal approach and allegedly forming a lobbying group referred to as the Open Cloud Coalition (OCC) that the Home windows maker has known as an “astroturfing” operation, filed its own complaint towards Microsoft with the EC in September, once more for overcharging prospects for Home windows Server on its and different non-Microsoft clouds. 

Google claimed Microsoft marked costs up by 400 % for purchasers on GCP, AWS, and different cloud providers. The present standing of Google’s Microsoft grievance is unclear, with no indication that the matter has moved ahead since being filed a little bit over two months in the past. The European Fee did not instantly reply to a request for remark. 

Nicky Stewart, a Senior Advisor to the Open Cloud Coalition, advised The Register in a press release, “Unfair software program licensing practices, like these highlighted on this case, are a big problem for cloud suppliers, disproportionately harming competitors and innovation throughout the cloud ecosystem. Decisive motion is required to deal with these licensing practices and promote truthful competitors for the good thing about companies and shoppers alike.”

Microsoft declined to remark. On Wednesday, nevertheless, it announced the costs it fees in British Kilos will fall between 5 and 6 % on account of its coverage of reflecting foreign money change fee adjustments in native foreign money pricing. ®