Europe Opens Investigations Against Qualcomm
The European Commission (EC) has opened two formal antitrust investigations into possible abusive behaviour by Qualcomm in the field of baseband chipsets used in consumer electronic devices.
The first will examine whether Qualcomm has breached EU antitrust rules that prohibit the abuse of a dominant market position by offering financial incentives to customers on condition that they buy the baseband chipsets exclusively or almost exclusively from Qualcomm. The second will look into whether Qualcomm engaged in 'predatory pricing' by charging prices below costs with a view to forcing its competition out of the market.
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.?
The first antitrust investigation focuses on Qualcomm's conditions related to the supply of certain chipsets that comply with 3G (UMTS) and 4G (LTE) standards and are used to deliver cellular mobile connectivity in smartphones and tablets. In particular, the Commission will investigate whether Qualcomm has granted payments, rebates or other financial incentives to its customers on condition that they purchase all or a significant part of their baseband chipsets requirements from Qualcomm, and whether any such behaviour might hinder the ability of rivals to compete.
The second investigation concerns Qualcomm's pricing practices with regard to certain chipsets that comply with 3G (UMTS) standards and are used to deliver cellular mobile connectivity. In particular, the Commission will be assessing whether Qualcomm has engaged in 'predatory pricing' by selling these chipsets at prices below costs, with the intention of hindering its competition from remaining in the market and competing with Qualcomm.
"We have been cooperating and will continue to cooperate with the Commission, and we continue to believe that any concerns are without merit," Qualcomm said in a statement.
The opening of proceedings against the world's largest supplier of baseband chipsets does not prejudge the outcome of the investigations.
Other U.S. corporations have already appeared on the EU's radar, with antitrust investigators looking into possible market abuse by Google and the ebook business of Amazon, as well as the European tax affairs of Amazon, Apple and Starbucks.
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.?
The first antitrust investigation focuses on Qualcomm's conditions related to the supply of certain chipsets that comply with 3G (UMTS) and 4G (LTE) standards and are used to deliver cellular mobile connectivity in smartphones and tablets. In particular, the Commission will investigate whether Qualcomm has granted payments, rebates or other financial incentives to its customers on condition that they purchase all or a significant part of their baseband chipsets requirements from Qualcomm, and whether any such behaviour might hinder the ability of rivals to compete.
The second investigation concerns Qualcomm's pricing practices with regard to certain chipsets that comply with 3G (UMTS) standards and are used to deliver cellular mobile connectivity. In particular, the Commission will be assessing whether Qualcomm has engaged in 'predatory pricing' by selling these chipsets at prices below costs, with the intention of hindering its competition from remaining in the market and competing with Qualcomm.
"We have been cooperating and will continue to cooperate with the Commission, and we continue to believe that any concerns are without merit," Qualcomm said in a statement.
The opening of proceedings against the world's largest supplier of baseband chipsets does not prejudge the outcome of the investigations.
Other U.S. corporations have already appeared on the EU's radar, with antitrust investigators looking into possible market abuse by Google and the ebook business of Amazon, as well as the European tax affairs of Amazon, Apple and Starbucks.
