14 DAY TRIAL // The second highest court in Europe has cleared Microsoft's acquisition of the Skype platform, saying that Cisco cannot demonstrate how the takeover would affect competition in the VoIP industry.
Cisco filed an antitrust lawsuit in 2012, one year after Microsoft completed the Skype acquisition, claiming that such a deal would harm competition on the Old Continent and asking the European courts to block the Redmond giant from taking over the service.
Now the judge has ruled that Microsoft's Skype deal does not infringe competition on the continent in any way, which means that “the Commission was correct in its assessment that the acquisition of Skype by Microsoft would not significantly impede effective competition in the European Economic Area (EEA),” as the EU antitrust body said in a statement today.
“The GC confirmed that the Commission was correct in finding that even on the narrow market for consumer video communications on Windows-based PCs only, Microsoft/Skype's high combined market share of 80 to 90% was not indicative of market power given the particular characteristics of the market in question, which is marked by short innovation cycles and products which are free,” the statement also reads.
“Therefore, if Microsoft started to make PCs users pay for such a product, this would only encourage them to switch to other providers that continue offering their services free of charge. Furthermore, in that quickly evolving and fast growing market where strong competitors are present, account should also be taken of the increasing use of mobile phones and tablets, where Microsoft was a relatively small player.“
While this is the second highest court in Europe and Cisco would have the option to appeal the decision, it's hard to believe that such a thing would actually happen, as Microsoft would most likely win at the EU Court of Justice as well.
In a statement for The Verge, Cisco explained that company executives are indeed “disappointed” with today's decision, but they hope that Microsoft would remain committed to interoperability.
“Cisco is disappointed that the Court did not require the Commission to revisit interoperability requirements for the Microsoft / Skype merger, however we remain committed to interoperability and will continue to work to make video calling as easy as making a phone call or sending an email. We are hopeful that in the interest of customers and consumers, Microsoft and others in the industry will join us and continue to rally around this ideal and work together to achieve an open, interoperable video community,” Cisco said.