Qualcomm Accused of Unfair Tactics in China, Investigation Under way

10 Feb

China’s National Development and Reform Commission (NDRC) has started an anti-monopoly investigation against the US chip manufacturing giant Qualcomm, CRI reports.

The investigation, allegedly, was prompted by the discovery that the US chip maker has been “overcharging” the patent fees for its Code Division Multiple Access technology (CDMA) and “conducting tied sales;” Such a behavior, CRI notes, has garnered the attention of both business and government entities, as it is hurting not just China’s mobile phone manufacturers, but also many of its core consumers.

As noted by Ni Guangnan (via CRI), an academic figure from the Chinese Academy for Engineering…

“For customers, they pay for what they’re given…Manufacturers pay a patent fee of up to five percent of the mobile phone set to Qualcomm, but the fee will finally fall on customers.”

Wang Yanhui, secretary general of China’s Mobile Alliance, shows equal concern for the long term impacts of Qualcomm’s patent based business model, especially since many of China’s mobile device manufacturers depend on its wireless technologies and chip components.

“As a consequence [of Qualcomm’s practice], China’s whole industry will be reduced to a manufacturing industry with all the profits going to overseas companies,” Wang said.