$1bn out of pocket: Real sues Microsoft

Streaming media provider RealNetworks is once again commencing legal action against long time nemesis Microsoft on antitrust charges, accusing the software giant of illegally using its Windows monopoly to hurt digital media rivals.

In the suit, filed in federal court in San Jose, California, RealNetworks alleges that Microsoft has "pursued a broad course of predatory conduct over a period of years...resulting in substantial lost revenue and business for RealNetworks."

The complaint adds that Microsoft has wielded its "monopoly power to restrict how PC makers install competing media players while forcing every Windows user to take Microsoft's media player, whether they want it or not."

In a conference call with reporters, RealNetworks General Counsel Bob Kimball said he believes the company's damages could exceed $1bn measured in lost business stemming from Microsoft's actions. The suit also seeks injunctive relief to prevent "further illegal conduct" by Microsoft.

Kimball said: "Our case is based on many of the same types of Microsoft conduct that have already [been] declared to be illegal - such as failure to disclose interface information and imposing restrictions on PC makers - as well as a broad course of additional predatory conduct."

Real said its lawsuit is complementary to the European Commission's ongoing investigation of Microsoft business practices. Real is cooperating with that inquiry.

In a statement, Microsoft responded that key allegations of the suit appeared to conflict with evidence of strong competition in the digital media market.

"RealNetworks' legal action today is unfortunate and particularly surprising given the intense competition in the digital media marketplace," Microsoft said. "The facts are clear. There is vibrant competition in this marketplace and RealNetworks' own reported growth shows that they have thrived on Windows and many other operating system platforms. Computer manufacturers are free to install and promote any media player on new PCs. Consumers are free to use any media player - and many consumers use several different media players."

Other charges allege that Microsoft used contractual restrictions and financial incentives to "force PC makers to accept Windows PC operating systems with the bundled Windows Media Player and to restrict the ability of PC makers to preinstall or promote competing digital media players".

Evan Hansen and David Becker write for News.com