EU upholds Microsoft's buyout of Skype

Cisco's challenge to open internet communications standards rejected

by Mark Hodgkinson Dec 11, 2013 at 10:25 AM

  • Tech News

    EU upholds Microsoft's buyout of Skype
    An EU Court has upheld a regulatory decision to approve Microsoft’s $8.5 billion takeover of Skype in 2011.
    The case was heard in response to a challenge by Cisco, the world’s leading manufacturer of network equipment.
    Cisco had argued, back in May 2013, that Redmond’s buy out of Skype created a monopoly and that the European Commission was erroneous in approving the deal, without forcing Microsoft to make some concessions.

    Clearly Cisco has a vested interest in the field and as owners of Skype competitors, WebEX, had called upon the EC to insist on more open standards for internet based communications, similar to those now in place for mobile phone operators.

    Cisco wants Microsoft (and others) to open the doors to other services so intercommunications could take place between, for example, Skype and WebEx users. With Skype’s market share vastly outnumbering that of WebEx, Cisco would have more to gain with more open standards being in place.
    Cisco wants WebEx users to be able to communicate with those on Skype.
    But the Luxembourg-based General Court said Cisco had failed to demonstrate that the takeover would be anti-competitive.

    "Microsoft's acquisition of Skype is compatible with the internal market. The merger does not restrict competition either on the consumer video communications market or on the business video communications market," the judges said.

    Cisco, who have yet to comment, can appeal again should they see fit but what are your thoughts on internet communications regulations – should standards be more open or it OK for operators to run a closed shop?

    Source: Reuters

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