EU Fines an Amount of $1.23 Billion to Qualcomm for its Payment of Exclusive Chip to Apple

EU Fines an Amount of $1.23 Billion to Qualcomm for its Payment of Exclusive Chip to Apple


Date: 24 Jan 2018 – The Qualcomm Inc has been spanked a anti-trust amount of €997 million fine that’s $1.23 billion, this Wednesday by the European Union, for illegally paying money to the Apple Inc. due to exclusive usage of its chip in Smartphones and various other products. THE EU announced today that it has labelled this amount as a fine for the Qualcomm due to the deal it has made that stood as a barrier for other companies from competing openly for chip businesses of Smartphone giant.  The fine is huge, but one decent thing is it’s still somehow below $2 billion, which the commission could have worked towards under the antitrust laws of the Europe. Although, official made it transparent that they believed in the strategy of Qualcomm that hurt limited edition and customer’s choice.

The head of the competition policy, Commissioner Margrethe Vestager, told that Qualcomm had illegally shut down rivals from the market for baseband chipsets of LTE for more than five years, and thus it had blocked the market dominance for itself. Qualcomm had paid billion dollars to one of the key customers, Apple, from preventing it to buy rivals. These payments made were not only just reductions in price but it also had conditions made that Apple would be exclusively using baseband chip of Qualcomm in all of its iPads and iPhones.

Earlier Qualcomm did deny its violation over antitrust laws. The investigation of the commission was launched in 2015, for the concerns that Qualcomm was exploiting its dominant position for LTE chipsets. Whilst, having dominance over market isn’t illegal, antitrust of EU makes it clear that those power can’t be used for limiting the competition.

Perhaps that investigation that has been found between the time span of 2011 and 2016, Qualcomm accounted for over 90 percent market-share. In its ruling the commission had concluded that it power had been abused as Qualcomm has made important payment to a key customer on a condition that it should exclusively use chipset of Qualcomm by blocking any significant chance of the rivals. This conduct by Qualcomm did have an affect over LTE baseband chipset on the entire market.

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