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US networking giant Cisco says that the EU should have imposed tougher conditions on Microsoft's takeover of Skype.
Major US networking firm Cisco has appealed the approval of Microsoft's acquisition of Skype with Europe's second highest court, Reuters reported.
Cisco is arguing that the European Commission should have implemented tougher restrictions on the $8.5 billion dollar deal, Bloomberg Businessweek reported. Messagenet, a European Internet communications service provider, has also joined Cisco in appealing the merger, AFP reported.
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Cisco is not against the merger, but has requested that the EU make sure the companies support standards for interoperability between other platforms, PC World reported. Users of Cisco's video conferencing programs, as well as others, are unable to call users on the Microsoft-Skype system except through an expensive gateway, a source familiar with the deal told PC World under the condition of anonymity.
“Imagine how difficult it would be if you were limited to calling people who only use the same carrier or if your phone could only call certain brands and not others,” Marthin De Beer, Senior Vice President of Cisco’s Video and Collaboration Group, wrote in a blog post. “Cisco wants to avoid this future for video communications.”
But EU regulators said the deal wouldn’t harm competition for video communications services because the market already had multiple major contenders, including Google, according to Bloomberg.
Microsoft won full approval to buy the international voice and video calling service from the EU’s antitrust agency in October.
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Microsoft said it does not expect the European Commission to revoke its decision to approve the deal.
"The European Commission conducted a thorough investigation of the acquisition, in which Cisco actively participated, and approved the deal in a 36-page decision without any conditions," a Microsoft spokesman said, AFP reported. "We're confident the Commission's decision will stand up on appeal."
Cisco was one of the companies initially interested in buying Skype, which was founded in 2003 and acquired by online auction giant eBay in September 2005, according to AFP.