EU: Qualcomm sold below cost to push Icera out of the market

Posted on Thursday, Jul 19 2018 @ 18:38 CEST by Thomas De Maesschalck
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Hot on the heels of yesterday's massive Google fine, the European Commission is now accusing Qualcomm of predatory pricing in the UMTS baseband chipset market. The Commission says that between 2009 and 2011, Qualcomm sold certain UMTS baseband chipsets below cost, with the goal of driving segment market leader Icera out of the market. Icera got acquired by NVIDIA in 2011.
The European Commission has sent a Supplementary Statement of Objections to Qualcomm Inc. This is a procedural step in the Commission’s ongoing investigation under EU antitrust rules looking into whether Qualcomm engaged in ‘predatory pricing’. The Commission sent a Statement of Objections to Qualcomm in December 2015 detailing its concerns. In particular, the Commission’s preliminary view is that between 2009 and 2011 Qualcomm sold certain UMTS baseband chipsets at prices below cost, with the intention of eliminating Icera, its main competitor in the leading edge segment of the market at that time. UMTS chipsets are key components of mobile devices. They enable both voice and data transmission in third generation (3G) cellular communication. The Supplementary Statement of Objections sent today focuses on certain elements of the “price-cost” test applied by the Commission to assess the extent to which UMTS baseband chipsets were sold by Qualcomm at prices below cost. The sending of a Supplementary Statement of Objections does not prejudge the outcome of the investigation. More information is available on the Commission’s competition website, in the public case register under the case number AT.39711.
Qualcomm denies any wrongdoing and responds it's disappointed by the news and that it will immediately begin preparing its response to this supplementary statement of objections. Previously, Qualcomm got fined $1.23 billion in the EU over LTE chip deals with Apple. If the chip maker is found guilty, it faces an additional fine of up to 10 percent of its global revenue.

Via: TechCrunch

About the Author

Thomas De Maesschalck

Thomas has been messing with computer since early childhood and firmly believes the Internet is the best thing since sliced bread. Enjoys playing with new tech, is fascinated by science, and passionate about financial markets. When not behind a computer, he can be found with running shoes on or lifting heavy weights in the weight room.

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