The Competition Commission of India (CCI) has rejected an antitrust complaint against Microsoft, which accused the company of abusing its dominance by bundling Microsoft Defender antivirus with its Windows operating systems.

The case, filed under Section 19(1)(a) of the Competition Act, 2002, was closed under Section 26(2) after the Commission found no prima facie evidence of anti-competitive conduct.

The complaint, filed by an undisclosed informant, claimed that Microsoft’s practice of pre-installing and pre-activating Microsoft Defender in Windows OS had effectively sidelined third-party antivirus providers. 

Market access

It was alleged that by requiring original equipment manufacturers (OEMs) to bundle Microsoft Defender, Microsoft restricted market access for competing security software developers, violating multiple provisions of the Competition Act.

According to the informant, Microsoft’s licensing agreements and participation requirements in the Microsoft Virus Initiative (MVI) programme created significant entry barriers. The complaint further claimed that Microsoft used its dominant position in the operating system market to leverage an unfair advantage in the antivirus sector, thus restricting competition and innovation.

Microsoft, in its defense, argued that integrating Defender into Windows OS was aligned with industry standards and essential for providing security to users. It maintained that Defender is not marketed as a standalone product but is a built-in feature offered at no additional cost. The company emphasised that users are free to install alternative antivirus solutions, and if a third-party antivirus software registers with Windows, Defender automatically disables its real-time protection. Furthermore, Microsoft asserted that its MVI software is voluntary, designed to enhance collaboration with security vendors, and does not restrict competitors from offering their products independently.

After reviewing the submissions, the CCI ruled that Microsoft’s inclusion of Defender does not impose unfair conditions on users or hinder competition. The commission noted that alternative antivirus software remains available, and OEMs can pre-install competing security solutions. It also highlighted that Microsoft’s actions had not impeded technical or scientific advancements in the cybersecurity market, as third-party antivirus firms continue to develop new features and remain competitive.

No coercion

On the allegations of illegal tying and bundling, the CCI determined that Microsoft Defender is integrated as a security feature rather than a separate product. The Commission found no coercion forcing consumers to use Defender exclusively, nor any substantial foreclosure of the antivirus market, as several major cybersecurity firms such as Norton, McAfee, and Bitdefender continue to thrive.

Regarding claims that Microsoft restricted non-MVI members from accessing Windows OS, the CCI concluded that participation in the MVI programme was not mandatory for antivirus developers. It also dismissed concerns that Microsoft leveraged proprietary information from MVI participants to gain a competitive advantage.

Ultimately, the commission found no violation of Section 4 of the Competition Act and closed the case. The order also granted confidentiality to the informant and select documents filed by both parties for a period of three years.

This ruling reinforces Microsoft’s position in India’s software market while setting a precedent on how the integration of security features in operating systems is viewed under Indian competition law. The decision is expected to have significant implications for software vendors and cybersecurity firms operating in the country, competition law observers said.