Technology and Business Law Blog

Microsoft’s takeover of Yahoo

On January 29, 2008 Federal Judge Colleen Kollar-Kotelly extended the period of sanctions imposed on Microsoft till November 2009 and it was based on the fact that Microsoft did not provide the protocol specifications documents as required by the consent degree agreement entered in 2002.

The protocol documentation was supposed to be made available by February 2003, so Microsoft is still under the radar for antitrust violations and will be further scrutinized with it’s $44.6 billion offer to takeover Yahoo. Microsoft hopes that having Yahoo under it’s umbrella will help its presence in the Internet online search and advertising market which is currently dominated by Google. The new entity after the merger will control about 33 percent of the U.S. search market. Google currently has a hold over 60 percent of the market.

This announcement helped Yahoo’s sagging stock price by almost 50 percent while Google’s fell more than 8 percent. The justice department said it is interested in reviewing the antitrust issues.


February 1, 2008 Posted by | Antitrust | Leave a comment

Apple Sued for Monopolizing Online Music

A complaint was filed against Apple stating antitrust law violation, that Apple had an illegal monopoly on the digital music market. Read here.

The focus of the complaint was that Apple’s iPod does not support the Windows Media Audio (WMA) format and charges the company with deliberately designing its iPod hardware to be incompatible with WMA. The complaint states that “Apple has engaged in tying and monopolizing behavior, placing unneeded and unjustifiable technological restrictions on its most popular products in an effort to restrict consumer choice, and to restrain what little remains of its competition in the digital music markets,” the complaint states. “Apple’s CEO Steve Jobs had himself compared Apple’s digital music dominance to Microsoft (NSDQ: MSFT)’s personal computer operating system dominance, calling Apple’s Music Store ‘the Microsoft of music stores’ in a meeting with financial analysts.”

January 4, 2008 Posted by | Antitrust | 1 Comment

Lime Wire’s Antitrust Charges Against RIAA Dismissed

The Federal courts seem to be inclined to side RIAA (Recording Industry Association of America) when it comes to p2p file sharing networks. Yesterday U.S. District Judge Gerard E. Lynch in New York ruled that Lime Group LLC failed to make its case that it has been harmed by the recording companies (RIAA’s) business practices and he granted the recording companies motion to dismiss the claims. Read here.
The background of this case is that RIAA brought a lawsuit against Lime Wire which is a file sharing applications provider in August 2006 for copyright infringement over songs distributed over the Internet without permission and claimed that this mode of sharing music was an illegal business model. Lime Wire’s defense is that they were not “actively inducing” copyright even if their software product was used for it and Lime Wire in turn filed an antitrust law suit against the recording companies stating that RIAA was trying to illegally compete with Lime Wire and other file sharing systems.

Judge Lynch concluded Lime Group didn’t show any facts to suggest the record companies’ actions were “anything other than independent decision-making by each company to refrain from doing business” with Lime Wire.

Lime Group had also contended the recording companies had fixed prices for online music, but Lynch concluded that the firm failed to establish it had been harmed by any alleged price fixing. Lynch also rejected claims by Lime Group that the record labels had engaged in unfair business practices, including hacking the firm’s file-sharing network and claiming it promotes child pornography, on the grounds that the alleged actions were not anticompetitive. The original case against Lime Wire by RIAA is still pending and it was the first piracy lawsuit brought against a distributor of file-sharing software after the U.S. Supreme Court ruled in 2005 that technology companies could be sued for copyright infringement on the grounds they encouraged customers to steal music and movies over the Internet. Read here.

It will be interesting to see how the court decides the original law suit against Lime Wire after the Federal court in the Capital Records v Jammie Thomas case held that the defendant was held guilty of copyright infringement for distributing songs over KaZaA another p2p file sharing system. Read my earlier post here.

December 4, 2007 Posted by | Antitrust, p2p, RIAA | Leave a comment

Google Watch Where You Are Heading

Microsoft faced antitrust violation allegations in the United States which was settled in 2002 but Microsoft had been paying millions of dollars to several companies like Sun Microsystems and RealNetworks to settle antitrust disputes, but in the European Union the court of First Instance held that Microsoft had abused its dominant position in the operating system market by bundling it’s products together. The European courts take a stricter view on antitrust, monopolistic practices and privacy issues. The court held that the Commission was right in requiring Microsoft to share technical specifications with it’s rivals and it also required the company to offer unbundled options to consumers if if tied two products together. Further the court also upheld the $613 million fine imposed by the Commission.

Basically the court wants to promote competition, innovation and provide choice to other innovators and consumers. The competition commissioner Neelie Kroes stated ” The court has upheld a landmark commission decision to give consumers more choice in software markets. That decision sets an important precedent in terms of the obligations of dominant companies to allow competition in particular in high tech industries.”

In Washington, Assistant Attorney General Thomas O. Barnett said the European ruling “may have the unfortunate consequence of harming consumers by chilling innovation and discouraging competition.”
“In the United States, the antitrust laws are enforced to protect consumers by protecting competition, not competitors.”

When Microsoft was targeted for antitrust suits in the 2000’s it was the elephant amongst the technology companies but now Google seems to have taken Microsoft’s place with it’s tentacles in every pie and is expanding further than Microsoft ever could contemplate and now Microsoft having taken the back seat. It will be interesting to see after this decision in Europe the effect it will have on the Google-DoubleClick merger and the antitrust allegations filed with the Federal Trade Commission. The merger allows Google to become the most dominant player in the search engine space. DoubleClick is a company that primarily develops and provides Internet as serving services and it advertises itself as the nerve center of digital marketing.

Google could be easily be classified as the most monopolist company in this era and it is already a target in EU for the privacy issues presented by it’s street view and other technology that peeps into an individual’s personal life, data and tracks each of their moves in the internet. See my earlier blog

While Google collects the search engine histories of it’s users, DoubleClick tracks what websites people visit and with both companies merging they could have access to too much information on each consumer internet activities and the impact on consumer privacy. Google has a market capitalization of $162 billion and the Federal Trade Commission and the European Union are still reviewing the merger on the initiative taken by watch groups like the Center for Digital Democracy and the Electronic Privacy Information Center which filed a complaint with FTC on April 20, 2007 about the merger and on September 17, 2007 filed a supplement stating that it is providing additional evidence about Google-DoubleClick business practices that fail to comply with accepted privacy safegaurds.

September 18, 2007 Posted by | Antitrust, DoubleClick, EU, FTC, Google, Microsoft, Monopoly, privacy | 1 Comment

Face Off between Microsoft and Google: Apple wins.

Here is an interesting article between Micosoft and Google’s antitrust allegations, while Apple makes most of it.

June 16, 2007 Posted by | Antitrust | Leave a comment