Microsoft Accused of Inflating Costs for Businesses Using Rival Cloud Platforms

Tech giant faces fresh antitrust scrutiny as cloud competition heats up.

Regulatory Pressure Mounts

Microsoft's cloud dominance faces another challenge—this time over allegations it's stacking the deck against competitors. Businesses report facing significantly higher operational costs when integrating rival platforms with Microsoft's ecosystem. The claims suggest a strategic play to lock enterprises into Azure by making alternatives financially punitive.

The Interoperability Tax

Experts point to licensing fees, data egress charges, and compatibility hurdles that create what one analyst called an 'interoperability tax.' The effect? Companies find their multi-cloud strategies—once hailed for flexibility and cost-saving—suddenly bleeding budget. It's a classic moat-building tactic, dressed in technical complexity.

Market Implications

While regulators circle, the cloud wars intensify. Rivals like AWS and Google Cloud could gain ammunition in the court of public opinion, even as enterprises grumble about vendor lock-in. The situation highlights a recurring theme in big tech: scale begets control, and control rarely lowers prices—unless a regulator is watching.

For finance folks, it's another reminder that in tech, the real 'cloud' is often the opacity of pricing sheets. The only thing rising faster than cloud adoption might be the creative accounting behind it.

Microsoft is accused of crafting cloud licensing rules harmful to competition

Stasi’s counsel, Sarah Ford, told the tribunal that the tech giant was using practices that “overcharged thousands of businesses” by making Windows Server more affordable to operate on Azure.

Ford also said that “Microsoft degrades the user experience of Windows Server” on competing clouds, which she argued was part of a coherent abuse strategy meant to establish its position.

Her remarks echoed long-standing concerns within the cloud industry. Smaller providers have complained for years that Microsoft’s licensing rules lock customers into Azure by making it more costly or less efficient to run key software elsewhere.

Even the UK’s Competition and Markets Authority has previously said that certain terms used by Microsoft have “materially disadvantaged AWS and Google”.

Microsoft rejects those claims. Its view is that the company’s structure, where it both runs Azure and licenses Windows Server to competitors, can help rather than hinder competition.

The firm says Stasi’s legal team has not offered a workable method for calculating the losses it is accused of causing and that the case should be dismissed before it goes any further.

As was previously reported by Cryptopolitan, European and UK regulators are also examining whether cloud giants, including Microsoft, Amazon Web Services, and Google Cloud, have amassed too much influence, with concerns ranging from data portability to restrictive licensing.

In July, the CMA reached a different conclusion when it released a report describing Microsoft’s cloud licensing rules as harmful to competition. The watchdog warned that these rules made it harder for customers to switch between providers or spread their workloads across different clouds.

Microsoft responded at the time by saying the analysis did not reflect the reality of a sector that has “never been so dynamic and competitive”.

Across Europe, regulators have shown rising interest in how cloud markets operate. The EU’s Digital Markets Act gives Brussels wider powers to respond if a small number of large firms become essential gateways for digital infrastructure. Officials have been considering whether the dominance of AWS, Azure, and Google Cloud meets that threshold, which WOULD trigger new obligations for them.

These could include forcing providers to ease the movement of customer data, scale back bundling practices, or improve compatibility with other platforms.

If the tribunal allows the UK lawsuit to proceed, it could become one of the most significant challenges Microsoft has faced in the cloud era. For the businesses involved, the case is about recovering money they believe they should never have been charged.

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