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September 30, 2016updated 03 Oct 2016 12:31pm

Salesforce tries to block Microsoft’s LinkedIn acquisition as EU focuses on data-rich deals

Competition Commissioner Margrethe Vestager believes that big data could be used to stop others competing.

By Alexander Sword

Salesforce has called on EU regulators to investigate Microsoft’s acquisition of LinkedIn, citing antitrust issues.

The customer relationship management (CRM) vendor’s chief legal officer Burke Nortonsaid that Microsoft’s gaining access to LinkedIn’s data would give Microsoft an “unfair competitive advantage”.

LinkedIn generates data from its users.

LinkedIn generates data from its users (From Statista website).

 

“Salesforce believes this raises significant antitrust and data privacy issues that need to be fully scrutinised by competition and data privacy authorities in the United States and in the European Union,” Norton said, according to a Bloomberg report.

LinkedIn

Microsoft’s Brad Smith responded to the claims.

Brad Smith, Microsoft’s president and chief legal officer, responded in a statement: “Salesforce may not be aware, but the deal has already been cleared to close in the United States, Canada, and Brazil.

“We’re committed to continuing to work to bring price competition to a CRM market in which Salesforce is the dominant participant charging customers higher prices today.”

Salesforce had been a potential buyer of LinkedIn, but lost out to Microsoft. In fact, a bidding war with Salesforce forced Microsoft to pay nearly $6bn more for its proposed acquisition of LinkedIn.

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Details of the bidding were revealed in a filing with the Securities and Exchange Commission (SEC) ahead of a shareholder vote to approve the agreement.

The buy-out gives Microsoft access to the data of 433m users, of which 105m are active every month. There is potential to integrate Salesforce into Microsoft’s other enterprise-focused services.

The EU will have to grant or deny approval to the deal in the coming weeks.

vestager

Margrethe Vestager is the EU’s Competition Commissioner.

 

Microsoft will have closely watched recent speeches from Margrethe Vestager, the European Competition Commissioner, who will have to make the decision.

In particular, she stated on 29 September that the Commission would be looking at whether it needed to more closely examine deals involving large amounts of data.

She said that “companies need to make sure they don’t use data in a way that stops others competing”, but said that holding a large amount of data is not necessarily a problem.

She said that her team was “exploring whether we need to start looking at mergers with valuable data involved, even though the company that owns it doesn’t have a large turnover.”

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