The European Union has fined Qualcomm $272 million for selling 3G modem chips at predatory prices in an attempt to drive out Icera, a competing supplier out of the market. Modems are usually paired with application processors in mobiles such as Samsung's Galaxy series and Apple's iPhone.
EU’s highest antitrust investigation found that Qualcomm had been selling its 3G modems to ZTE and Huawei at a loss between 2009 and 2011, stunting the growth of Icera. Qualcomm disagrees with the assessment and is planning to appeal. The fine imposed on Qualcomm is about 1% of its global turnover in 2018. It’s about ten times lesser than the maximum fine imposed under EU antitrust law.
According to Margrethe Vestager, EU’s Competition Commissioner, “Qualcomm’s strategic behavior prevented innovation and competition in this market, limited the choice available to consumers in a sector with a huge demand and potential for innovative technologies.”
Qualcomm’s executive vice president and general counsel, Don Rosenberg, said in response that “Commission had based its decision on the pricing over a very short time period and for a very small volume of chips and that Qualcomm’s actions had not caused any harm to Icera, which continued to compete in the market after it was acquired by Nvidia. This decision is unsupported by the law, market facts, economic principles and we look forward to a reversal on appeal.”
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