Multiven Files Antitrust Complaint Against Cisco Systems with Swiss Competition Commission

Multiven GmbH (“Multiven”) filed on Monday, an antitrust complaint against Cisco Systems (“Cisco”) with the Swiss Competition Commission, in an effort to open up the network maintenance services marketplace for Cisco equipment, promote free and fair competition while enhancing 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 software updates 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 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);

  • Cisco coercing its 52,000 reseller partners to refuse-to-deal with Multiven and not resell better quality and/or lower cost services from Multiven – an Independent Service Organization (“ISO”) – that competes with Cisco SMARTnet,
  • Cisco voiding the software licenses of customers that install their valid Cisco software on genuine Cisco equipment procured from Cisco-independent sources.

These acts aimed at preventing competitors like Multiven from servicing Cisco networking equipment have had the following anti-competitive and injurious effects in the Swiss marketplace for Internet network services:

  • Competition in the market for 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 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.

Multiven’s requested remedies are intended to give consumers greater freedom, choice and cost savings while ensuring that the network maintenance services marketplace develops into an open, fair and competitive industry where Cisco competes solely based on the quality and value of its services.

Multiven is represented by Schellenberg Wittmer – led by Dr. Jürg Borer and Dr. Juhani Kostka.

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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