Microsoft customers report being refused capacity, migration projects stuck halfway, and accusations that AI is being prioritised over ‘bread and butter’ offerings
Microsoft Azure is refusing capacity to cloud customers in the company’s UK South (UKS) region, with issues around the availability of Azure virtual machines (VMs) – especially in AMD-based compute, those aimed at HPC workloads and graphics processing unit (GPU)-equipped services.
That’s according to comments made to Computer Weekly and in message board threads on Reddit, where many blame Microsoft’s drive to roll out datacentre resource-hungry Copilot AI to the detriment of existing customer requirements.
One commenter said: “It’s well known to be terrible and apparently is waiting for more capacity to come online at the end of the year.”
Another said: “Terrible capacity issues in UKS. It seems to be impacting one availability zone more than others, and AMD CPUs [central processing units] are far more scarce. We’ve been executing a migration and have faced a number of hurdles securing quota and capacity. I’m told Microsoft are in the process of moving their own internal services such as M365 out of those datacentres to free up capacity for customers.”
Azure’s UK South region has had capacity issues for some time. Earlier this year, one customer reported being stuck part-way through an Azure Virtual Desktop migration due to not being able to secure capacity.
“With 75% of our staff moved, and around 40 vCPU used, we are being denied all additional capacity requests, even after raising tickets and escalating,” they said. “Because of the nature of the apps that we use, low latency is vital (really, it prefers local LAN). We are also required by many of our clients to host data in the UK only due to the nature of what we do.
“We’d successfully migrated around 75% of the company, and then when trying to increase quota to finish the job, found that we were denied capacity for everything we tried, v5 and v6 [Azure VMs], AMD, Intel. We escalated several tickets, and were told that our request would be backlogged and denied by the region owner due to capacity.”
Another commenter said they could get capacity for the platform as a service offering they work on, but could not be sure about future requests: “The service I work on has capacity in UK South – but what happens if we have to scale out further to make room for more resources?”
UK South is one of two Azure regions in the UK. The other is UK West, based in south Wales.
UK South can offer Availability Zones, which means operations are spread across three datacentres to offer resilience. Many UK South customers run primary operations there and use UK West – which is a single datacentre – as a disaster recovery failover location.
Some disgruntled customers believe Microsoft has prioritised the roll-out of datacentre capacity for Copilot AI to the detriment of existing services. In other words, that roll-out of GPU-equipped servers – which are massively resource-hungry – have put a squeeze on datacentre capacity.
“Reading between the lines, the rush to AI has f****d Microsoft’s bread and butter services,” said one commenter. “So, they’ve effectively shot themselves in their foot pushing out a product no one wants, to the detriment of one people do.
“All resources are thrown into the AI abyss. It’s also created hardware shortages that don’t seem to have an end.
AI sales focus
Owen Sayers, an independent consultant with decades of experience in delivering public sector IT, said: “In UK South, Microsoft offers 10 different types of GPU. In UK West, they have just two, and the A100 there is no spring chicken. Microsoft are focusing heavily on sales of AI, and if customers in the UK are buying GPU, it’s pretty much always going to be in UK South as their anchor tenancy.
“That will increase heat, power and load,” he added. “Nothing restricts datacentre capacity more than a few hundred power-draining GPUs. Also, Microsoft wants to sell GPUs with everything, so perhaps their focus has drifted from traditional cloud towards AI and they aren’t managing capacity well as a result.”
According to data from Barbour ABI and ComputerWeekly, around 121MW of datacentre capacity is due to complete in 2026, in areas that come within Azure’s UK South and West regions. The bulk of that will be at a Virtus development in High Wycombe in Bucks, a Kao development at Harlow in Essex, and for Vantage Data Centres in Newport, South Wales, which would be within UK West and could allow capacity to be reallocated.
Microsoft responded to a summary of complaints with the following: “Azure is delivered through a global network of around 80 regions worldwide, giving customers flexibility in how they deploy and scale workloads. As customer demand for Azure services in the UK remains strong, we continuously monitor and adjust how resources are allocated to ensure reliable support for existing customer workloads and maintain service availability and performance.”
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