Microsoft and Apple hit with Class Action Lawsuits in the UK

The masses are taking antitrust law into their own hands. 

On Tuesday, two separate antitrust class lawsuits were filed against Microsoft and Apple in the UK. The Microsoft case relates to how the company bundles up its cloud computing business with its Windows software, while the Apple case is focused on how the company levies payment fees on its App Store. Both are subjects that have drawn regulatory scrutiny in the US and Europe, but now litigants are the ones driving the antitrust action.

Class Act

This year has been big for US trustbusters, with the Department of Justice winning its antitrust case against Google’s search engine business, which the DOJ said is far too dominant. The DOJ wants to split Google up, which is not a sure thing, and as we head into a new administration, it’s unclear whether the pace of US antitrust enforcement will remain as high as it has over the past four years, particularly with Federal Trade Commission Chair Lina Khan looking likely to get replaced under the new Trump Administration. 

But regulator action in Silicon Valley companies’ home country isn’t the only antitrust threat against them. As global companies, they’ve faced multibillion antitrust fines in the EU, and the Microsoft case brought on Tuesday looks to leave a similar dent in the company’s finances:

• The case is being brought by the UK arm of US law firm Scott + Scott on behalf of businesses and organizations, and the firm said in a press release it’s seeking over £1 billion ($1.3 billion) in compensation. The lawsuit alleges that Microsoft charges businesses which don’t use its cloud service, Microsoft Azure, more to license its Windows Server, thereby unfairly raising prices for companies that don’t combine its services.
• Microsoft is already facing regulatory scrutiny over how it ties its various services together. The EU said in June that Microsoft broke antitrust law by bundling its Teams workplace communications platform with its business software.

The class action lawsuit should sit well with Google, which filed an EU complaint in September essentially alleging the same thing, that Microsoft abuses its position as a software provider to leverage its position in the cloud market — where it happens to be much more dominant than Google. 

Bad Apples: The developer case against Apple, over the allegedly anticompetitive commissions of as much as 30% charged on App Store sales, could cost the Cupertino company as much as $995 million and comes on the heels of another UK class action lawsuit against the iPhone giant. Last month UK consumer watchdog group Which? brought a case alleging that Apple has been “trapping” customers with Apple devices into using its cloud service, which it says is overpriced. The group is going after £3 billion ($3.8 billion) to distribute among UK consumers. That would be a big bite of the Apple.