Multiven Files Formal Antitrust Complaint Against Cisco Systems with the European Commission
ZURICH, Switzerland – Monday, September 9, 2013, Multiven GmbH (“Multiven”) today announces that on August 20, 2013, it filed a formal antitrust complaint against Cisco Systems (“Cisco”) with the European Commission, in an effort to open up the Internet network maintenance services market for Cisco equipment, promote free and fair competition while ensuring consumer choice and value. Multiven’s complaint alleges that Cisco abuses its dominant position to harm consumers by bundling and tying software bug fixes, patches and updates (“software updates”) for its operating system and application software to its maintenance services (“SMARTnet”) and through a series of other illegal exclusionary and anti-competitive acts designed to maintain Cisco’s monopoly in the network maintenance services market for Cisco networking equipment, which represents 75% of the world’s Internet infrastructure.
The complaint recites that instead of making these necessary and crucial software updates freely available to all customers that have purchased its operating system and application software licenses, as does Apple, Hewlett-Packard, Microsoft and many others, Cisco makes these software updates only available to those customers that have purchased, at additional costs, its SMARTnet service.
The complaint further alleges that Cisco also engages in a series of illegal exclusionary and anti-competitive acts such as, but not limited to coercing its 52,000 reseller partners, which includes Telecommunication and Internet Service Providers within the EEA, to refuse-to-deal with Multiven and not consume nor resell better quality and/or lower cost services from Multiven and other Cisco Independent Service Organization (“ISO”) – that compete with Cisco SMARTnet.
These acts aimed at preventing ISOs like Multiven from servicing Cisco networking equipment have had the following anti-competitive and injurious effects within the European Union and EEA marketplace for Internet network services:
- Competition in the multi-Billion Euro market for the service and maintenance of Cisco networking equipment has been suppressed and virtually eliminated. Additionally, ISOs have been effectively precluded from competing for and earning profits on the servicing of Cisco networking equipment.
- Customers have been deprived of choice and forced to purchase Cisco SMARTnet maintenance services over that of substantially better quality and/or lower priced maintenance services from ISOs like Multiven; and
- Consumers have been harmed because supracompetitive prices have been maintained and increased, and the quantity, quality and choice of service offerings in the marketplace has been reduced and constrained.
“Every cyberattack is an exploitation of a software defect.“ stated Peter Alfred-Adekeye, Multiven founder & CEO ”Cisco’s refusal to make all software updates freely available to all customers that have purchased its software not only stifles free and fair competition but also puts the Internet at risk of avoidable cyberattacks on a daily basis”.
Multiven President Deka Yussuf said: “Another prime example of Cisco’s abuse of its dominant position is its ongoing resistance to the global adoption of cost saving innovations like Software Defined Networking”
Multiven was established in 2005 to provide businesses using all brands of Internet networking equipment with reasonably priced, cutting-edge maintenance services to keep their networks running smoothly. But owners of Cisco hardware are reluctant to engage Multiven or other independent maintenance providers to maintain their Cisco equipment, because without SMARTnet, they cannot reasonably access essential Cisco software bug fixes.
Multiven’s complaint submits that Cisco is infringing European competition law because it is abusing its dominant position in various ways, including, but not limited to;
- tying software bug fixes to the service and maintenance of its Internet networking equipment;
- refusing to supply its bug fixes separately;
- bundling sales of its Internet networking equipment with its aftermarket servicing products; and
- imposing excessive prices.
Multiven’s requested remedies are intended to give customers complete freedom of choice which will lead to reduced Internet voice, video and data access costs for consumers while ensuring that the maintenance services market for Internet-enabled devices develops into an open, fair and competitive industry where Cisco competes solely based on the quality and merit of its services.
Multiven is the leading provider of cloud-based management and maintenance services for all Internet-enabled devices. By offering service-as-a-utility, powered by its cloud-based global workforce of elite network experts, while leading consumer advocacy that ensures customer choice and value, Multiven is realizing its mission of making the Internet network globally available, reliable and affordable for all mankind. For more information about Multiven, please visit www.multiven.com.
Multiven is a registered trademark of Multiven, Inc. and Multiven GmbH. All other company and product names may be trademarks of the respective companies with which they are associated.
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