RealNetworks yesterday began legal proceedings against Microsoft, citing "violations of federal and state antitrust laws".
The complaint alleges that Microsoft has used its monopoly power to restrict competition and monopolise the fast-growing digital media sector.
According to RealNetworks, Microsoft has pursued a "broad course of predatory conduct over a period of years by abusing its monopoly power, resulting in substantial lost revenue and business for RealNetworks".
The legal challenge claims that Microsoft has restricted how PC makers install competing media players while forcing all Windows users to take Microsoft's media player whether they want it or not.
Rob Glaser, chairman and chief executive of RealNetworks, and a former Microsoft employee, said: "While we much prefer competing in the market - as we are doing and have done for nine years - our board has made a carefully considered business decision to take this action to end Microsoft's illegal conduct and recover substantial damages on behalf of our shareholders."
But Microsoft hit back: "It's hard to reconcile Real's own statements on its marketplace success with today's lawsuit. Real claims to be the number one provider of digital media solutions, with massive distribution of its software and more than one million player downloads a week.
"Thus, this is a case where a leading firm is seeking to use the antitrust laws to protect and increase its marketplace share and to limit the competition it must face."
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