Qualcomm charged with antitrust violations by European Commission

The regulators at the European Commission have filed antitrust charges against mobile chip maker Qualcomm, claiming it paid a lot of money to an unnamed smartphone and tablet company to use their chips exclusively in their products.

The European Commission, the regulatory arm of the European Union, launched formal antitrust investigations against Qualcomm earlier this year. The final verdict of that inquiry levels two charges at the company:

"The first Statement of Objections outlines that since 2011, Qualcomm has paid significant amounts to a major smartphone and tablet manufacturer on condition that it exclusively use Qualcomm baseband chipsets in its smartphones and tablets. The Commission takes the preliminary view that this conduct has reduced the manufacturer's incentives to source chipsets from Qualcomm's competitors and has harmed competition and innovation in the markets for UMTS and LTE baseband chipsets. The contract between Qualcomm and the manufacturer containing the exclusivity clauses is still in force.""The second Statement of Objections takes the preliminary view that between 2009 and 2011 Qualcomm engaged in 'predatory pricing' by selling certain baseband chipsets at prices below costs, with the intention of hindering competition in the market. This conduct appears to have taken place at a time when Icera posed a growing threat to Qualcomm in the leading edge segment of the market, offering advanced data rate performance. In the Commission's preliminary view, Qualcomm reacted to that threat by selling certain quantities of its UMTS baseband chipsets to two of its customers at prices that did not cover Qualcomm's costs, with the aim of forcing Icera out of the market."

Qualcomm has until April 2016 to formally respond to the charges. It's possible that the European Commission could fine Qualcomm for its alleged actions.

Source: European Commission

John Callaham