CHIPMAKER QUALCOMM FACES FRESH ANTITRUST SCRUTINY IN EUROPE OVER RFFE 5G CHIPS
The chip giant, Qualcomm faces fresh antitrust scrutiny from the bloc, based on the regulatory concern over chips for radio frequency front-end (RFFE) that is deployable in 5G devices. Meanwhile, prior to the recent European Commission’s scrutiny, it’s been observed the chipmaker has been faced with a series of lawsuits over its practices.
According to Reuters, recently, Qualcomm has extended its chip business into radio frequency front-end chips for 5G devices. In a bid to encourage buyers of its 5G modems to equally purchase its radio frequency front-end chips in order to make sure they don’t buy from other vendors and integrating their hardware with its 5G modem chips.
According to reports, the chipmaker is still in the process of responding to this development. Confirming the development, an EC spokeswoman said that, “We confirm that the Commission has sent out questionnaires, as part of a preliminary investigation into the market for radio frequency front end”.
In another response from the European Commission spokeswoman, which proves things are still unclear, adding that “Our preliminary investigation is ongoing. We cannot comment on or predict its timing or outcome”. Credit: Techcrunch
Responding to this development (Qualcomm facing fresh antitrust), the chipmaker wrote based on the regulator request of information in early December, “notifying us that it is investigating whether we engaged in anti-competitive behavior in the European Union (EU)/ European Economic Area (EEA) by leveraging our market position in 5G baseband processors in the RFFE space”.
Also, based on uncertainty surrounding the current EC scrutiny, Qualcomm stated that “It is difficult to predict the outcome of this matter or what remedies, if any, may be imposed by the EC”, adding that: “We believe that our business practices do not violate the EU competition rules”.
Also, this is not the first antitrust action Qualcomm has faced in Europe, and if the chipmaker has violated European Commission rules, it warned its investors of EC capability of imposing a fine of up to 10 percent of its annual revenue which could also extend to issuance of injunctive relief that could restrict some trade practices.
Drifting from the case of Qualcomm facing fresh antitrust scrutiny with the European Commission, it’s understood the subject chipmaker is currently battling a major competition case in the United States. Three years ago, the United States Federal Trade Commission (FTC) filed a lawsuit against the chip giant, accusing it of deploying anticompetitive tactics in order to maintain a monopoly in its chip business.
In 2019, a United States court also backed the Federal Trade Commission, in an agreement that Qualcomm violated antitrust law, and warned that such behavior will likely continue, placing the chip giant as a key producer of modems for next-generation 5G cellular technology, although, Qualcomm has appealed.
In 2018, it was also figured out, the European Commission also fined Qualcomm $1.23 billion in a different antitrust case related to its dominance in LTE chipsets for smartphones – specifically about its relationship with iPhone and Apple. However, the chip giant in a statement made it clear that it will continue to vigorously defend itself in the foregoing matters.
- What is your take as Qualcomm faces fresh antitrust scrutiny?