Qualcomm used anticompetitive tactics to maintain monopoly over semiconductor supply
18 Jan 2017
Qualcomm used anticompetitive tactics to maintain a monopoly over semiconductor supply, the Federal Trade Commission (FTC) alleged in a complaint yesterday.
According to the FTC, the chipmaker imposed anticompetitive supply and licensing terms on smartphone manufacturers for profit and to weaken competitors. If manufacturers did not agree to Qualcomm's conditions, they would not get access to crucial cellular tech.
The FTC had asked courts to order Qualcomm to put an end to its anticompetitive conduct and take the required actions to restore competitive conditions. In 2014, Qualcomm disclosed that the FTC was looking into its licensing practices.
According to the FTC, Qualcomm allegedly,
- Maintained a "no license, no chips" policy under which it supplied its baseband processors only on the condition that cell phone manufacturers agreed to Qualcomm's preferred license terms.
Refused to license standard-essential patents to competitors. - Extracted exclusivity from Apple in exchange for reduced patent royalties, which, according to the Feds, prevented Apple from moving to one of Qualcomm's competitors.
- This was not the first anti-trust issue for Qualcomm, which had earlier been fined $890 million for monopolistic practices in December. Taiwanese officials had also started to check on the company.
The complaint said, ''Qualcomm's customers have accepted elevated royalties and other license terms that do not reflect an assessment of terms that a court or other neutral arbiter would determine to be fair and reasonable,'' the complaint said.
According to commentators, the complaint was probably the last major action from the body under its current chairwoman, Edith Ramirez, a Democrat, who would step down on 10 February, and comes only days before president-elect Donald J Trump took office.
Trump was expected to name commissioner Maureen Ohlhausen, a Republican, as acting chairwoman and would have three other vacancies to fill to reshape the agency.
Qualcomm had faced several antitrust rulings and investigations from regulators across the globe.
