), globally the largest mobile chip manufacturer, is facing one
after one allegation for abusing its market dominance which
resulting in monopolistic practice.
Recently, Reuters reported that the mobile baseband
semiconductor behemoth is likely to face a European Union (EU)
regulatory investigation linked to a four-year old complaint.
Qualcomm currently carries a Zacks Rank #3 (Hold).
In Jun 2010, British mobile chip developer Icera accused
Qualcomm of using patent-related incentives and exclusionary
pricing of chipsets for capturing Icera's business by unfair
In the meantime, Icera was acquired by NVIDIA Corp. (
), a close competitor of Qualcomm in 2011. Reuters also reported
though unconfirmed, Qualcomm may face a fine to the tune up to $2.5
billion if found guilty.
The EU competition authority at times takes several years to
open an investigation. In Jun 2014, Intel Corp. (
), the global leader in the overall semiconductor market, was fined
a substantial $1.45 billion for abusing its dominant market
Earlier in 2010, Qualcomm enjoyed a major reprieve by the EU
regulator as Texas Instruments Inc. (
) and Ericsson A.B. withdrew their litigations against the
Meanwhile, Qualcomm is currently in deep trouble in China. In
Nov 2013, the Chinese regulatory authority, National Development
and Reform Commission (NDRC), initiated a probe on the company
related to its monopolistic practice.
A state-run Chinese news paper stated that the NDRC has
determined that Qualcomm is exercising monopolistic power in the
country and may need to pay $1.2 billion or more in fine. More
importantly, the company might also have to forego royalties of
TDD-LTE as a settlement. Such unfavorable actions will severely
impair Qualcomm's patent portfolio.
In 2009, South Korean regulatory authority, the Fair Trade
Commission, imposed a $269 million fine on Qualcomm for adopting
unfair means to expand its CDMA modem chipset business in that
country. Large mobile device manufacturers such as, Samsung and LG
Electronics were using those chipsets.
Additionally, Qualcomm is facing two patent litigation cases
from ParkerVision Inc. In 2011, ParkerVision claimed that Qualcomm
had violated its patents associated with the conversion mechanism
of electromagnetic signals from higher frequencies to lower
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