Qihoo 360 ponders Tencent case appeal

One of China's leading anti-virus software providers Qihoo 360 Technology Co is considering an appeal after a court Thursday rejected its claims in a 150 million yuan ($24 million) antitrust lawsuit against Tencent Technology Co, China's largest Internet company by market value.

A judgment from the Guangdong High People's Court said that Weibo is a real alternative to Tencent's instant messaging platform QQ, which does not dominate or manipulate the market, where there is genuine competition between players in China and abroad.

Qihoo 360 filed a lawsuit against Tencent to the court in November 2011, alleging that the company's interests were damaged by Tencent abusing its dominant market position in the instant messaging sector to force QQ users to uninstall 360's software.

The court rejected Qihoo 360's allegations, saying that it failed to prove QQ's dominant position. The loser will have to pay court costs worth 796,800 yuan in total. But the result is not final and the court said any appeal should be filed to the Supreme People's Court within the next 15 working days.

"We respect but disagree with the court's decision. The court did not accept our objective statements," Qihoo 360 said in an e-mail to the Global Times Thursday, pledging to see the fight against monopoly through to the end.

Tencent said Thursday that it respects the court's decision, but would not comment on Qihoo 360's e-mail.

Yao Kefeng, a Shanghai-based Internet lawyer who does not represent either of the parties, expressed his disappointment in the Guangdong court's judgment when contacted by the Global Times Thursday, saying that the judge had made a technical mistake in wrongly defining the "relevant market" by comparing QQ with Weibo.

QQ belongs to the instant messaging industry, which Yao believes excludes Weibo.

Yao noted that according to law, a player is presumed to dominate the market as long as its market share surpasses 50 percent.

Data from iResearch Wednesday showed that QQ accounted for 70.2 percent of the instant messaging industry as measured by daily users in February.

However, whether QQ violated China's Anti-Monopoly Law still merits further investigation, said Yao.

Defining "relevant markets" is the key to settling antitrust lawsuits, but poses a tough task for domestic lawyers due to the abstract legal definition and insufficient experience in this field, ­Jiang Zhipei said Thursday. Jiang is presiding judge with the third civil tribunal of the Supreme People's Court, which specializes in intellectual property.

According to the Anti-Monopoly Law, which took effect in 2007, "relevant markets" refers to the range of goods or the geographical area within which operators compete to provide goods and services during a specific time.