Court to rule in Cisco v Commission case
Cisco challenged Commission decision to approve Microsoft’s acquisition of Skype.
The European Union’s General Court will on Wednesday give a ruling in a case involving three giants of the digital economy – Microsoft, the world’s largest software provider; Cisco, the world’s leading manufacturer of networking equipment; and Skype, the world’s most popular software for telephony over the internet.
Cisco challenged the European Commission’s decision in 2011 to approve Microsoft’s €6 billion acquisition of Skype. Cisco is concerned that Microsoft will use Skype’s popularity with consumers to increase the market share of Lync, Microsoft’s business server.
Cisco claims that business customers may no longer be interested in its, market-leading, messaging and conferencing products, as they would be denied access to Skype’s 850 million customers. This situation would be made worse, Cisco claims, by Microsoft integrating Skype and Lync into its office software packages, including Windows, Outlook and Office.
In March, the Commission announced that it was fining Microsoft €561 million for breaking its pledge to offer a choice of web browsers to users of its Windows operating system, the latest in a series of fines imposed on the company.
However, in this case the Commission and Microsoft have found themselves fighting the same corner. Both argue that Skype has very little market power despite having an estimated share of 80% of consumer video and voice calls. Competition is just one click away, they argue – echoing a defence used by Google to counter an investigation into its dominant position.
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