Last October, Microsoft won final approval from the European Commission to go ahead with its acquisition of the popular VoIP service Skype. Now, however, this approval is being challenged by network equipment maker Cisco. While Cisco says it doesn't oppose the merger, it does want the European Commission to place "conditions that would ensure greater standards-based interoperability." The Italian VoIP and fixed-line provider Massagenet also joined Cisco's appeal.
When the original deal was unconditionally approved, the Europen Commision explicitly noted that "there are no competition concerns in this growing market where numerous players, including Google, are present."
Cisco: Afraid that Microsoft Could "Control the Future of Video Communications"
Cisco, according to its appeal, worries that Microsoft/Skype could "seek to control the future of video communications." That seems to be quite a stretch given how vibrant this market is. While Microsoft will integrate Skype into its mobile operating system, there is little reason to believe that it could "control the future of video communications." Maybe Cisco is more worried about losing an edge in the enterprise market once Microsoft integrates Skype into its productivity solutions for large companies.