Kaspersky Lab Files Claim with European Regulators Seeking Antitrust Investigation of Microsoft

Kaspersky Lab has applied to the European Commission and the German Federal Cartel Office seeking their consideration of Microsoft’s actions with regards to compliance with the respective articles of the antitrust legislation, concerning abuse of its dominant position in the market for computer operating systems and unfair competition in the market for solutions for protecting against computer threats.

With the release of Windows 10, Microsoft started to (i) create obstacles to competing manufacturers of security solutions, and (ii) introduce different ways of pushing users to forgo third-party software in favor of its own Windows Defender. These actions by Microsoft lead to (i) a lower level of protection for users, (ii) a limitation on their right to choose, and (iii) financial losses both for users and security solutions manufacturers.

Kaspersky Lab has asked the respective agencies to review Microsoft’s compliance with competition law, including concerning the following:

• Microsoft’s public appeals and recommendations to replace an already installed security solution of competitors with its own product, as well as misleading users as to the consumer properties and qualities of Windows Defender in advertisements;
• Microsoft causing hindrances to the upgrading, as well as downloading and installing of security solutions of its competitors, making it difficult for users to work with programs, while reducing their level of protection. For example, not seeing that the antivirus database of the security solution is out-of-date – as caused by a limitation introduced by the OS – the user runs the risk of becoming a victim of cybercrime;
• Microsoft providing the final build of a new version of the operating system (so-called RTM) a few days before the public release – instead of two months as done previously. Manufacturers need two months to test their products and make necessary changes to ensure compatibility with the new operating system. Also, during such testing critical errors may be detected in the operating system itself, and Microsoft needs time to patch them too. Thus, when users upgrade to the next version of Windows, their level of protection may be reduced;
• In some scenarios when moving over to a new version of Windows 10, when the user has security software installed that is incompatible with the OS, before the updating process begins the OS informs the user that all applications will be saved. What actually happens is the drivers of third-party security software are deleted – making it unusable. Then, after installation of the update, Microsoft informs the user of the necessity to download compatible security software; however, this message is barely noticeable, which leads users to the loss of the previously paid-for license for the program. This is evidenced by support service statistics, media publications, and the respective class action lawsuit in the United States;
• The inability for users to fully disable and/or remove Windows Defender, which violates their right to decide which applications to install and run on their devices.

Kaspersky Lab believes that all of the above limits freedom of choice for users, and not only creates inconvenience for them when using third-party programs on their devices, but also reduces their level of security. A user should be able to receive reliable information regarding their protection and use the programs they choose without impediment.

In addition there is a danger for users caused by the lack of equal opportunities for all manufacturers of security solutions. Healthy competition stimulates companies to create better quality security solutions that positively impact on the industry in general, and the protection of users in particular. Variety of security solutions on the market allows people to choose the best, and makes bypassing protection by cybercriminals more difficult.

According to Professor and Doctor of Economics, Andrei Shastitko, who made an economics investigation for this case by request of Kaspersky Lab: "The analysis of the scenario of the circulation of OSs and AV programs shows that Microsoft’s actions directed at squeezing out other manufacturers from the AV software market by way of limiting access to an essential facility^[1] and exploiting the cognitive biases of users will likely lead to the realization of scenarios with negative consequences for the public, both in static and dynamic terms.”

Kaspersky Lab decided to appeal this situation to the respective legal authorities after its multiple requests to Microsoft were not addressed.

For more details, please read Eugene Kaspersky’s blogpost.

^[1] It is a specialized term used in competition law and economics to describe a “facility” or utility that is necessary ("essential") for competitors to provide goods and services to their customers.