Earlier this year, the US Federal Trade Commission and Apple both filed lawsuits against Qualcomm, citing anti-competitive business practises. Now, it seems that Samsung and Intel are also piling on, backing the FTC’s suit against the company, claiming that they too have been harmed by Qualcomm’s business practises.
It might surprise you to hear that Samsung is backing the suit against Qualcomm, given that the two companies have worked closely. Most recently, Qualcomm tapped Samsung to produce the Snapdragon 835 processor, which went on to be featured in the Samsung Galaxy S8. However, there appears to be some bad blood brewing under the surface. According to Samsung, Qualcomm has been blocking the company from selling licensed Exynos chipsets to non-Samsung entities.
Intel on the other hand had a lot more to say about Qualcomm, listing off three key business tactics the company uses to stifle competition:
- “An unprecedented “no-license-no-chips” policy, whereby Qualcomm refuses to sell OEMs any chipsets unless those manufacturers also purchase separate patent licenses that require them to pay exorbitant royalties for every handset they sell, regardless of whether the handset contains a Qualcomm chipset;
- A refusal to license SEPs to competitors, in violation of its FRAND commitments;
- A long-running exclusive supply arrangement with Apple that resulted in below-cost pricing for Qualcomm’s chipsets and substantial foreclosure of the premium baseband chipset market.”
Intel branded this as Qualcomm’s way of coercing customers into exclusivity deals, which in turn, ‘fences’ competitors out of the market and creates a “lack of alternative supply options”. Since there are fewer alternative options, companies are increasingly reliant on Qualcomm’s supply chain.
KitGuru Says: With more companies coming out to back the FTC’s case against Qualcomm, the situation is looking increasingly dire for the chip maker. After this, it seems doubtful that the FTC will drop its case like Qualcomm had previously hoped.