Jan 24, 2018

EU fines Qualcomm more than $1 billion

Ina Fried, author of Login

The European Commission on Wednesday said it was fining Qualcomm 997 million Euros ($1.23 billion) for abusing its dominance in the market for LTE chips.

Why it matters: This adds to Qualcomm's headaches. The company has already faced fines in China and inquiries in the U.S., is in a bitter dispute with Apple (one of its biggest customers) and is fighting a hostile takeover bid from rival Broadcom.

What the EU is saying:

Qualcomm illegally shut out rivals from the market for LTE baseband chipsets for over five years, thereby cementing its market dominance. Qualcomm paid billions of US Dollars to a key customer, Apple, so that it would not buy from rivals. These payments were not just reductions in price – they were made on the condition that Apple would exclusively use Qualcomm's baseband chipsets in all its iPhones and iPads.
This meant that no rival could effectively challenge Qualcomm in this market, no matter how good their products were. Qualcomm's behaviour denied consumers and other companies more choice and innovation – and this in a sector with a huge demand and potential for innovative technologies. This is illegal under EU antitrust rules and why we have taken today's decision."
— EU Competition chief Margrethe Vestager

What Qualcomm says:

The company plans to appeal.

“We are confident this agreement did not violate EU competition rules or adversely affect market competition or European consumers. We have a strong case for judicial review.“
— Don Rosenberg, executive vice president and general counsel

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