Qualcomm Becomes Target Of EU Anti-Trust Regulators

Qualcomm recently got into trouble with the Chinese government, which decided to investigate numerous American companies based on anti-trust and national security concerns. Now, the EU regulators may be doing the same after they have finally decided to respond to a four-year-old anti-trust complaint made against Qualcomm by Icera, a modem company acquired by Nvidia three years ago.

The main accusation made by Icera is that Qualcomm used both patent-related incentives and exclusionary pricing of its chips to stop its customers from doing business with Icera. Until now, though, the complaint was ignored by the EU Commission. It is possible that the fact that China was investigating Qualcomm over anti-trust issues also prompted the EU Commission to see if there's any truth to these accusations.

It also happens that an EU Court upheld a 1.1 billion euro fine against Intel over similar accusations in a case that started years ago. It's not uncommon for the EU to build a case for several years to make sure it's gotten everything right and only then go to court if the vendor refuses to pay the fine (as in Intel's case).
Back in 2006, Ericsson and Texas Instruments also made a complaint against Qualcomm, but in 2010 the companies dropped the complaint, so the EU Commission closed the case. This time, however, it seems Qualcomm won't get off so easily, and the Commission may open a new case against Qualcomm after the summer is over. 

Over the past few years, Qualcomm, formerly known primarily as a modem maker, has seen rapid growth in the mobile industry, beginning with the company making the first 1 GHz mobile processor and then continuing with high-performance, battery-efficient chips that had integrated LTE modems. That advantage over the competition gave Qualcomm a big head start in LTE markets and made it almost the default choice for most OEMs.

There have been clear benefits for OEMs going with Qualcomm's chips, so it's still unclear as to what exactly Qualcomm did wrong here, and how. But market leaders tend to become less than nice to the competition when they're at the top, especially if they want to keep that position and have the power to easily squash any rising threat.

Until the EU opens a full investigation into Qualcomm to see what is real and what is not and makes public more details, it's hard to know whether the accusations are exaggerated or if Qualcomm did indeed try to hurt the competition in some less-than-legal ways.

Follow us @tomshardware, on Facebook and on Google+.

Create a new thread in the US News comments forum about this subject
This thread is closed for comments
9 comments
Comment from the forums
    Your comment
  • somebodyspecial
    Since NV owns icera now, I wonder if a victory would net them anything. Even if not it would certainly hurt Qcom's finances. EU seems to hand out Billion+ fines these days to any billion dollar company they target for taxation (LOL).
    0
  • Duckhunt
    Quote:
    Since NV owns icera now, I wonder if a victory would net them anything. Even if not it would certainly hurt Qcom's finances. EU seems to hand out Billion+ fines these days to any billion dollar company they target for taxation (LOL).


    Well secret payments ( bribes) maybe ok for you but it is not good for competition and not good for the economy. What is next? targetted killings against the competition because you can't compete? It is funny how the so many champion the free market as long as it suits them.


    Intel secretly paid computer manufacturers to buy only intel CPUs from Intel..
    Intel made direct payments to computer manufacturers to stop or delay the launch of specific products containing a competitor's x86 CPUs and to limit the sales channels available to these products.

    That maybe ok to happen in the USA with the Failed DOJ, failed other regulator agencies but its not ok in the EU.
    1
  • daekar
    You know, I don't like a lot of what happens in the EU, but I'm with them on this one. I'm all about the free market, hard work, and private enterprise, but pro-competition laws like this are laws that I absolutely believe in. I don't know if QC is guilty - no axes to grind here - but they should abide by laws AND ethical business practices even if they aren't bound by the force of law. When a company forgets the Golden Rule with respect to its employees, customers, and competitors, then they have become a perfect example of why unions and regulatory laws were originally created.
    0