Microsoft’s massive $8.5 billion deal to buy Skype seems to be working its way through U.S. regulatory scrutiny without much trouble, but there may be a new wrinkle emerging in the European Union. Italian VoIP company Messagenet has written to the European Commission warning that if Microsoft is permitted to acquire Skype, it will solidify Skype’s dominant position in VoIP calling, excluding other VoIP companies from the market. Messagenet’s proposed solution: let Microsoft buy Skype, but forbid Microsoft to bundle Skype software with its Windows operating systems and require Skype to make its VoIP services interoperable with other Internet phone providers.
Microsoft hasn’t responded to the letter, but a spokesperson noted that Microsoft and Skype are conducting “business as usual” since the proposed acquisition is still in regulatory review. The European Commission was expected to announce its decision on the acquisition next week.
Messagenet’s proposal that Microsoft be barred from bundling Skype services into its core Windows operating system echoes of earlier European regulatory scrutiny that say Microsoft offering versions of Windows without Windows Media Player. Microsoft also offers a version of Windows 7 without Internet Explorer in Europe in response to complaints it was abusing its dominant position in the browser market. The IE-free Windows 7 is is mainly aimed at OEMs who want to ship computers with a different browser installed by default; consumers who buy the retail software get IE on a separate CD.
According to a report in the New York Times the Messagenet complaint could delay regulatory approval of the Skype acquisition.
Skype boasts over 120 million regular users worldwide; Messagenet has about 400,000 registered users of fax, SMS, and VoIP services.