Qualcomm receives $1.2 billion fine for violating EU antitrust rules

Polycount

TS Evangelist
Staff member

Qualcomm and Apple have a complicated past. In early 2017, the latter filed a lawsuit against Qualcomm which alleged that the company was charging royalties for technology they "[had] nothing to do with."

This legal action set off a series of suits and countersuits between the two companies. The latest suit occurred in November with Apple claiming that Qualcomm's Snapdragon mobile processors infringed on their patents.

It's a messy situation that might not improve any time soon. According to The Verge, Qualcomm has received a fine of $1.2 billion (€997 million) for allegedly violating the European Union's antitrust laws.

Specifically, the court's ruling states that "Qualcomm prevented rivals from competing in the market by making significant payments to a key customer on condition it would not buy from rivals."

The technology in question involves LTE baseband chipsets. In 2011, Qualcomm and Apple signed an agreement that would involve the former offering Apple "significant payments" so long as the smart phone maker didn't source these chipsets from any other company.

Though internal documents reportedly suggest that Apple "gave serious consideration" to switching over to other chipset manufacturers (such as Intel), they would be forced to give back a "large portion" of the payments received from Qualcomm if they did so. The court sees this as a "material factor" in Apple's decision to stick with Qualcomm until the terms of their agreement ended in 2016.

Qualcomm's general counsel and executive vice president Don Rosenberg offered the following statement:

"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 and we will immediately commence that process."

This ruling is certainly bad news for Qualcomm but it could be a positive development for the smartphone market as a whole. More competition and choice for Apple's business can only be a positive thing for consumers and it's likely that Apple will avoid such exclusivity agreements in the future.

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yRaz

Nigerian Prince
I guess this makes apple the technological analog to the New England Patriots?
 

Uncle Al

TS Evangelist
I'm guessing THEIR employee's won't be getting that $1,000 bonus that so many other corporations are giving their employee's to celebrate the new corporate tax structures .....
 

hk2000

TS Booster
I can understand the conflict between Apple and Qualcomm- well, not really, but I can accept they have disputes. What I don't understand, is why the EU is making money off of it? What can the EU do if American corporation refuse to pay these ridiculous fines? If I were in Qualcomm' or Microsoft's place, I'd say go kick rocks- Let's see if your citizens can live without us.
 
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merikafyeah

TS Addict
I can understand the conflict between Apple and Qualcomm- well, not really, but I can accept they have disputes. What I don't understand, is why the EU is making money off of it? What can the EU do if American corporation refuse to pay these ridiculous fines? If I were in Qualcomm' or Microsoft's place, I'd say go kick rocks- Let's see if your citizens can live without us.
As with Intel, Google, and Microsoft etc, while losing the EU market wouldn't cripple them as a company there also would not be any winners. Completely abandoning the EU market would lose Qualcomm much more than just $1.2 billion. As a public company the shareholders would simply never allow that considering how profit-minded they are.
 
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