ChatGPT customers procure accused Microsoft of “mercilessly” choking OpenAI’s compute provide by an irregular cloud agreement, artificially inflating AI subscription prices while concurrently speeding its procure competing merchandise to market.
The lawsuit, filed Monday in San Francisco federal court docket, alleges Microsoft “secretly grew to alter into an investment correct into a stranglehold,” the utilization of its Azure cloud dominance to prohibit the computational resources wished to bustle ChatGPT, conserving prices at ranges reaching “100 to 200 events” competitors’ charges for the length of a February 2025 AI tag battle.
Eleven ChatGPT Plus subscribers introduced the case, alleging they overpaid for subscriptions and obtained degraded carrier from November 2022 by February 2025 as a consequence of Microsoft’s anticompetitive conduct.
The lawsuit calls the case “a sequel to U.S. v. Microsoft,” invoking the firm’s 1990s antitrust battles and characterizing it as a “recidivist violator” that has “ported the identical exclusionary playbook into AI.”
Microsoft’s 2019 deal gave irregular rights to present Azure compute to OpenAI’s commercial gadgets, successfully giving the firm contractual regulate over a “horizontal competitor’s provide chain” while it constructed its procure generative AI merchandise, in conserving with the filing.
The plaintiffs clarify a fresh antitrust market, the Person Generative AI Market, encompassing subscription merchandise esteem ChatGPT Plus, Claude Real, Gemini Evolved, and DeepSeek Chat.
Microsoft reportedly holds a 49% stake in OpenAI’s for-earnings arm and takes 20% of its paid-product earnings, the lawsuit alleges, successfully “profiting twice—first from compute sales, and but again from the very AI product it constrains.”
When OpenAI started shopping compute from Google Cloud in June 2025, ending Microsoft’s exclusivity, ChatGPT token prices dropped 80 percent within weeks, in conserving with the complaint.
A ‘highly effective experiment’
The complaint calls it a “highly effective pure experiment” exhibiting Microsoft’s “anticompetitive restraint,” noting that sooner than the shift, ChatGPT customers confronted “melancholy quality, unreleased innovations, and unhurried response events.”
“On proof, the strongest proof may per chance perchance perchance be the irregular agreement itself,” Navodaya Singh Rajpurohit, good companion at Coinque Consulting, told Decrypt. “If that doc presentations Microsoft held or worn regulate over OpenAI compute, that is predominant proof. If it’s no longer readily available, interior emails and capacity details can mute elevate the case.”
“Restraint of exchange turns on regulate,” Rajpurohit acknowledged, adding the say is actual if Microsoft surely exercised or clearly held that regulate, but weaker if it didn’t.
The complaint furthermore alleges Microsoft “mute retains the contractual ability to prohibit OpenAI’s compute purchases,” a vitality that lingers “as a sword of Damocles over OpenAI, wielded by one of its predominant competitors.”
Plaintiffs are searching for monetary damages and a everlasting injunction barring Microsoft from irregular compute deals with OpenAI, alongside with disclosure of interior communications on compute provide, pricing, and integration.
“The court docket can enact bigger than horny the firm,” Rajpurohit explained. “It goes to train adjustments to the OpenAI affiliation, remove irregular terms, and assign guardrails that prevent future choke sides.”
The class-action arrives amid shifts within the Microsoft-OpenAI relationship. Japan’s SoftBank is reportedly negotiating to make investments up to $25 billion in OpenAI, surpassing Microsoft’s $13 billion stake. Within the period in-between, Microsoft has agreed beneath the Stargate challenge to terminate its irregular cloud provider draw.
Microsoft and OpenAI didn’t at the moment answer to Decrypt’s requests for commentary.
