Wednesday, June 19, 2013

Cisco Is Still Trying To Block Microsoft's 2011 Skype Acquisition (CSCO)

John Chambers CNBC

Cisco CEO John Chambers

Microsoft closed its $8.5 billion acquisition of Skype in October 2011 and, believe it or not, Cisco is still trying to fight that deal.

It will argue in court on Wednesday why the European Commission's approval should be overturned, reports Reuters' Foo Yun Chee. This stems from an initial complaint Cisco filed in February 2012.

It's rare for the court to overturn the EC's decision. The last time that happened was in 2002 with Sony Music and BMG, a more obvious threat than Microsoft and Skype.

What Cisco really wants is for after-the-fact requirements to be slapped on Microsoft. It wants the court to force Microsoft to make Skype's PC-based teleconferencing tech work better with Cisco's expensive, room-based teleconferencing tech.

Microsoft's Skype doesn't support the same video and audio standards used in Cisco's products.

That's not a big concern for Microsoft, but it is for Cisco. Cisco fears that Skype combined with Microsoft's enterprise videoconferencing product, Lync, will hurt Cisco's Telepresence business.

The truth is, Skype actually can work with Cisco's TelePresence systems if companies buy a service from Microsoft called Skype Connect or a third-party connection service like Blue Jeans Network or Kontiki. Still, Cisco would like to force Microsoft to change its technology.

Lync hasn't, so far, worked well with Skype though. In June, the two products will finally work together for instant messaging and voice, but video is still to come.

We've reached out to Cisco for comment.

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