Broadcom, Ericsson, NEC, Nokia, Panasonic Mobile Communications and Texas Instruments have each filed complaints to the European Commission requesting that it investigate anti-competitive conduct by Qualcomm in the licensing of essential patents for 3G mobile technology.
The companies state that QUALCOMM is violating EU competition law and failing to meet the commitments Qualcomm made to international standard bodies around the world that it would license its technology on fair, reasonable and non-discriminatory terms. Absent these commitments, the WCDMA 3G standard would not have been adopted. The companies allege that QUALCOMM is infringing these rules by:
- trying to exclude competing manufacturers of chipsets for mobile phones from the market and preventing others from entering. To this end, Qualcomm has committed a number of abuses, ranging from the refusal to license essential patents to potential chipset competitors on fair, reasonable and non-discriminatory terms to offering lower royalty rates to handset customers who buy chipsets exclusively from QUALCOMM.
- charging royalties for its WCDMA essential patents that are excessive and disproportionate; in particular by imposing the same royalty rate on WCDMA 3G handsets as it does for CDMA2000 3G handsets despite the fact that QUALCOMM has contributed far less technology to the WCDMA 3G standard than it has to the CDMA2000 standard.
The companies believe that Qualcomm’s anti-competitive behavior has harmful effects for the mobile telecommunications sector in Europe, as well as elsewhere, because carriers and consumers are facing higher prices and fewer choices.
QUALCOMM Response
In response, Qualcomm issued a statement saying that the allegations are factually inaccurate and legally meritless. QUALCOMM said it has more than 130 licenses that it has granted to a broad range of companies, among them five of the six reported claimants.
QUALCOMM also disagreed with any suggestion that it has contributed less significant technology to the WCDMA 3G standard, saying “it is widely acknowledged that efforts to design around QUALCOMM’s fundamental innovations in formulating the UMTS/WCDMA standard were unsuccessful.”
QUALCOMM said it believes this action is nothing more than an attempt by these licensees to renegotiate their license agreements by seeking governmental intervention.
QUALCOMM also noted that contrary to the reported allegation that it is seeking to exclude chip competitors, QUALCOMM has licensed major chip manufacturers, including Texas Instruments, NEC, Infineon, Philips, Agere, Motorola, VIA and Fujitsu.
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