European Commission Fines Qualcomm €242m For Anti-trust Violations
by Andrei Frumusanu on July 18, 2019 9:30 AM EST
Today the European Commission has concluded a 4 year long antitrust investigation into anti-competitive business behaviour of Qualcomm against other players in the market, and has fined the company €242 million for abusing its market dominance in 3G baseband chipsets during the period of 2009 to 2011.
The investigation was formally opened on July 16th 2015 and particularly looked at Qualcomm’s behaviour in the late 3G/UMTS and early 4G era where it held a commanding lead over other vendors in supplying modem chipsets.
The Commission concluded that Qualcomm had engaged in predatory pricing of three chipsets with evidence that the company had aimed to strategically push out and eliminate new contenders in the market, with a specific mention of Icera.
The Commission goes into more detail in regards to Qualcomm’s pricing behaviour in the mid-2009 to mid-2011 period where it concluded that it sold UMTS chipsets below cost to Huawei and ZTE, two important customers, with the goal of eliminating Icera.
Icera was an up-and-coming UMTS and LTE vendor which had started to see success in the market, and ended up being acquired by Nvidia with plans of integrating the technology into the Tegra line-up of SoCs, one product of this venture ending up being the Tegra 4i. The Tegra 4i unfortunately saw very little success among vendors in the market even though the chipset was technically equivalent to the Snapdragon 800/801 SoCs at the time. Nvidia ended up shuttering the division in 2015 due to a lack of success.
Qualcomm has communicated that the company is planning to appeal the finding.
The fine comes shortly after a recent scathing ruling in the US where the FTC had accused the company of similar anti-competitive behaviour breaching antitrust laws, and several years of scrutiny and fines by several regulatory agencies of various countries around the world.
Related Reading:
- European Union Opens Up Antitrust Investigation Into Qualcomm
- United States Rules Qualcomm In Violation of Antitrust Laws - Qualcomm To Appeal
- European Union Fines Qualcomm $1.23 Billion for Anti-Competitive Apple Deal
- Taiwan Fines Qualcomm $773 Million for Antitrust Violations
- United States FTC Charges Qualcomm with Antitrust Violations over Cellular Modem Patents & Technology
- South Korea Fines Qualcomm $865 Million for Anti-Trust Violations
- China Fines Qualcomm $975 Million for Anti-trust Violations
- NVIDIA to Acquire Icera, Adds Software Baseband to its Portfolio
- NVIDIA Tegra 4 Architecture Deep Dive, Plus Tegra 4i, Icera i500 & Phoenix Hands On
- NVIDIA Plans To Wind Down Icera Modem Operations In 2016
Source: European Commission Press Release
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boozed - Thursday, July 18, 2019 - link
Haha whatHighTech4US - Thursday, July 18, 2019 - link
Nvidia should sue Qualcomm using this judgement to get back what it paid to acquire Icera plus punitive award for lost business income.Nvidia won against Intel so now they should go after Qualcomm.
Raqia - Thursday, July 18, 2019 - link
I don't know where you're getting the technical equivalence of the Tegra 4i with the Snapdragon 800/801 from.You damn Qualcomm with your last paragraph, but don't forget to mention that there was no wrongdoing found after years of hearings in Japan:
https://www.cnet.com/news/qualcomm-not-a-monopoly-...
and the initial findings were ultimately vacated in Taiwan:
https://www.qualcomm.com/news/releases/2018/08/09/...
Many of the other findings were made with ulterior motives by powerful entities. In China, the NDRC fine paved the way for the recent ascension of Huawei. In Korea, powerful conglomerate OEMs have far more sway over the government and would like nothing better than to pay less for IP to pad their margins. And ofcourse the same holds for Apple who wanted the same in the US and instigated the FTC lawsuit against Qualcomm. After several years of Apple paying no royalties and Intel pouring massive resources into modem development, they came up with an inferior product that they had to sell below cost and Apple ended up going back to Qualcomm due to their technical inferiority rather than any kind of artificially anticompetitive behavior.
The development of a reliable and power efficient world cellular standard along with its associated modem accelerators is more complex than CPU instruction sets and more stringent than GPUs where a large computational error might go largely unnoticed by the user. It's less tangible to most tech reviewers as testing equipment is expensive and less appreciated because it generally just works well, and Qualcomm's licensing model (which constitutes a discount for lower price OEMs) is far more pro-competitive than Intel's almost entirely closed licensing scheme. There's no reason an Intel laptop SoC should cost more than a Snapdragon (even after royalties) which is arguably the more technically sophisticated SoC.
Andrei Frumusanu - Thursday, July 18, 2019 - link
> I don't know where you're getting the technical equivalence of the Tegra 4i with the Snapdragon 800/801 from.Because they were technical equivalent in specs?
I also suggest you actually read most of the 250-page FTC suit ruling because you make very little sense in anything you say on the topic.
Raqia - Thursday, July 18, 2019 - link
I've read it, the judge parrots the FTC's flawed theories, utterly misunderstands the nature of Qualcomm's inventions, and imposes a remedy that far overreaches the market scope of the evidence presented in the trial (which shouldn't have even applied to the narrow market in which they brought the case in the first place.) I take it you've seen the recent justice department rebuttal to the misapplication of law by Koh:https://www.cnet.com/news/doj-says-antitrust-rulin...
in which they declare that Qualcomm is likely to win on appeal.
I think many people assume in their mind that Qualcomm is somehow a villain in the industry due to Apple's smear campaign starting in 2017 and misrepresentation of their contributions to cellular standards using analogies of a "couch" to describe IP. I don't think Qualcomm is benign at all, but their business practices are largely standard in the cutthroat semiconductor industry and don't violate actual antitrust laws when properly read and interpreted. They've attained their dominance first and foremost through technical superiority.
Andrei Frumusanu - Thursday, July 18, 2019 - link
The Justice Department is looking after national interests, not actual fair competition happening.I think you need a clarity check on the matter because the bias you're showing is clearly clouding your judgement. It certainly isn't a post-2017 smear campaign as the issues had been raised for years before that in the industry.
> They've attained their dominance first and foremost through technical superiority.
They aren't even among the top license holders or contributors to recent standards like 5G, and by quite some margin. Huawei, Ericsson and Nokia all don't seem to have much issues in regards to licensing their technology.
Raqia - Thursday, July 18, 2019 - link
If you read the justice department's amicus brief, they specifically address the high likelihood that Koh's remedies would chill competition rather than enhance it because of its effects on patent protection and associated revenues for all inventors which both incentivize and serve as budgets for R&D:https://drive.google.com/file/d/1VJobscIdAwk5MwePS...
"The district court’s ruling threatens competition, innovation, and national security."
Furthermore, the number of standard essential patents on file don't reflect the how seminal or important they are to a standard.
I don't particularly love Qualcomm's business practices and I think they do have issues that should be addressed by regulatory enforcement. I do think misunderstanding of both their IP and the nature of IP by the public is rampant. I also believe patent laws are generally beneficial to society in incentivizing innovation, competition and speed to market and Qualcomm is a prime example of this system working very well.
Again, why do you think it's the case that Intel SoCs cost so much more than Android SoCs (adjusting for performance, power consumption etc.)? I think in the end it's down to the IP licensing model and the attack on Qualcomm's model is deeply misguided.
melgross - Thursday, July 18, 2019 - link
This has nothing to do with Apple. Apple’s problems with them occurred several years later. This comes from 2015.melgross - Thursday, July 18, 2019 - link
They were vacated in Taiwan after Qualcomm made orom8ses tp pour money into Taiwan’s technology industry, and help it.Don’t be naive about this. All the complaints aga8nst Qualcomm have been shown to be true.
Raqia - Thursday, July 18, 2019 - link
I would entreaty the same of you. It's one of these situations where most people don't understand or appreciate the scope of Qualcomm's actual achievements and lend an ear to extremely powerful IP implementers like Apple whose products can be held in the hand and are far more tangible. Although they've settled, the perception created by Apple still has momentum.