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Qualcomm is under investigation by the European Union's antitrust authority, which suspects the company of abusing its dominant position in the market for 3G and 4G chipsets used in smartphones and tablets.
The European Commission has initiated proceedings against Qualcomm in two investigations, it said Thursday. The first concerns whether Qualcomm breached EU antitrust rules by offering financial incentives to phone manufacturers on condition that they buy chipsets exclusively, or mostly, from the company; the second, whether Qualcomm engaged in predatory pricing, selling below cost to force competitors out of the market.
Mobile processors and baseband chipsets, which handle the communications protocols used in wireless networks, form a significant proportion of the cost of a mobile phone and, at least at the low end of the market, margins are getting thinner, leaving phonemakers more vulnerable to pricing pressures from their suppliers.
The EU Commissioner in charge of competition policy, Margrethe Vestager, said "We are launching these investigations because we want to be sure that high tech suppliers can compete on the merits of their products. Many customers use electronic devices such as a mobile phone or a tablet and we want to ensure that they ultimately get value for money. Effective competition is the best way to stimulate innovation."
Qualcomm's business practices have come under antitrust authorities' scrutiny before. Earlier this year, Chinese regulators fined Qualcomm $975 million for overcharging device makers there.
[...]
Qualcomm said it had been notified that the Commission had initiated proceedings against it in the two ongoing investigations. It will continue to cooperate with the Commission, but believes the concerns are without merit, it said.
More coverage of this story can be found at The Register and ITWorld.
Original Submission
(Score: -1, Troll) by Anonymous Coward on Thursday July 16 2015, @03:38PM
Another successful US company being investigated by the EU? What a surprise!
(Score: 2) by jcross on Thursday July 16 2015, @04:28PM
Well if we let large companies unfairly suppress the up-and-comers, they'll eventually use their monopoly powers to screw the customer and at the same time their products will go to shit because they don't need to compete on quality. In the very long term this will be bad for everyone, even the companies in question; see Microsoft. Let me know when the EU beats up on someone who's making bank on the value proposition of their product and not on sheer muscle.
(Score: 0) by Anonymous Coward on Thursday July 16 2015, @04:43PM
It's not Qualcomm's fault that EU companies are shitty competitors.
(Score: 0) by Anonymous Coward on Thursday July 16 2015, @04:53PM
There, I think that's what you meant.
In the last three months they've brought charges against Qualcomm, Amazon, Google, Apple, and Facebook.
It's funny, if you look at the Competition Commission's news page [europa.eu], you see lots of "approves" and "deal cleared" for EU company actions (mergers, etc.), and lots of investigations into non-EU companies. At what point do you say there is something to this pattern that goes beyond the law?
(Score: 0) by Anonymous Coward on Thursday July 16 2015, @05:02PM
The EU companies can't compete so the commission has to punish the US companies for being too successful.
(Score: 2) by jcross on Thursday July 16 2015, @05:14PM
Can you give some examples of European competitors to these companies, which the EU might be protecting? I don't see this happening with say, car companies or Boeing, where the EU does have prominent competitors, but maybe it's just that the European Amazon or Google competitor is not so well known?
(Score: 3, Interesting) by janrinok on Thursday July 16 2015, @05:05PM
I think that maybe you are missing the point. America is currently promoting a trade agreement to ensure fair trade between Europe and America - in both directions - not just one. If you think the EU is picking on US companies now, wait until the TTIP is forced upon us. The agreement means that we can take more US companies to court in Europe and the results will be binding both in Europe and inside the US.
You should do a little more research - the EU does far more of this sort of thing to EU companies to ensure fair trade and practices between nations - but that doesn't get noticed by those outside of Europe. Just one example, it will soon cost no more to use mobile roaming in Europe than it will to use your mobile/cell in your native European country. No more individual companies gouging phone users because they happen to have traveled on holiday or, in some instances, have simple driven a short distance from one country to another. We like this sort of thing. It is the US that has the bad reputation for making service something that people cannot afford, and we will do what we want to ensure that US companies don't try to bring unfair practices here.
(Score: 0) by Anonymous Coward on Thursday July 16 2015, @05:08PM
You should do a little more research
I should do research for your claims?
the EU does far more of this sort of thing to EU companies to ensure fair trade and practices between nations - but that doesn't get noticed by those outside of Europe.
And all the citations you provided formed quite the convincing case. Oh wait...
(Score: 3, Insightful) by janrinok on Thursday July 16 2015, @05:26PM
Well, in that case, carry on whining.
If you want to trade in a country, you have to play by their rules, not the one's that you would like to bring with you.
(Score: 0) by Anonymous Coward on Thursday July 16 2015, @05:27PM
Well, in that case, carry on whining.
Translation: You have no evidence to back up your claims so you'll just sling ad homs.
(Score: 0) by Anonymous Coward on Thursday July 16 2015, @06:45PM
Well, in that case, carry on whining.
Translation: You have no evidence to back up your claims so you'll just sling ad homs.
Nice to see the tradition of the "ugly American" continued with such verve! And yes, this is an argumentum ad hominem, but that is not always a fallacy, since sometimes the moral character of the person is relevant to the case.
(Score: 0) by Anonymous Coward on Thursday July 16 2015, @08:27PM
American? Hardly. I'm about 100 kg too light to be an American.
(Score: 1, Interesting) by Anonymous Coward on Thursday July 16 2015, @06:44PM
Qualcomm is the Intel or M$ of wireless communications tech. They own a ridiculous number of patents over wireless, and invented CDMA (at least for phones). No one else can come close because no one else owns the core patent portfolio for all these technologies.
And that's just the stuff we know about. Companies started by ex-Qualcomm people can easily be found in a quick search that make stuff for the US Military. Compared to them, everyone else is running incredibly far behind.
Just to top things off, Qualcomm has been very anti-FOSS (or open-anything--the pinout for the connector on the outdated Globalstar GSP-1600 satellite phone is STILL proprietary!) for as long as I can remember, so, yeah, they have this coming.
(Score: 0) by Anonymous Coward on Thursday July 16 2015, @08:28PM
How horrendous of them to actually invent tons of technology and be successful due to that How evil of them. If there's one way we should reward such companies its through investigations and fines.