Qualcomm about to have a China crisis

Stefan Mileschin · 30th January 2014, 08:45

US chipmaker Qualcomm is about to be bitten in the rump with a record $1 billion fine by the Chinese antitrust watchdogs.

China's National Development and Reform Commission (NDRC) investigated Qualcomm last year and according to Reuters is having a quiet word with the US outfit.

Qualcomm has said it was still in the dark about the basis of the scrutiny, but it seems the NDRC is targeting IT providers which license patent technology for mobile devices and networks.

Cynics claim that the Chinese are using the NDRC to force foreign IT companies to lower domestic costs as it rolls out its faster 4G mobile networks this year.

What the NDRC is doing is trying to force Qualcomm to make all sorts of commitments regarding its technology and the licensing of it.

Qualcomm will make a bomb in licensing fees for the chip sets used by handsets in China, the world's biggest smartphone market as Chinese telecom firms invest $16.4 billion in equipment for 4G networks.

Under China's anti-monopoly law, the NDRC can impose fines of between 1 and 10 percent of a company's revenues for the previous year. Since Qualcomm earned $12.3 billion in China for its fiscal year ended September 29 that could be a serious amount of dosh.

The fine could be even higher if Qualcomm fails to make concessions in its talks with the NDRC.

http://news.techeye.net/business/qua...a-china-crisis

30th January 2014, 08:45	#1
Stefan Mileschin [M] Reviewer Join Date: May 2010 Location: Romania Posts: 153,514	Qualcomm about to have a China crisis US chipmaker Qualcomm is about to be bitten in the rump with a record $1 billion fine by the Chinese antitrust watchdogs. China's National Development and Reform Commission (NDRC) investigated Qualcomm last year and according to Reuters is having a quiet word with the US outfit. Qualcomm has said it was still in the dark about the basis of the scrutiny, but it seems the NDRC is targeting IT providers which license patent technology for mobile devices and networks. Cynics claim that the Chinese are using the NDRC to force foreign IT companies to lower domestic costs as it rolls out its faster 4G mobile networks this year. What the NDRC is doing is trying to force Qualcomm to make all sorts of commitments regarding its technology and the licensing of it. Qualcomm will make a bomb in licensing fees for the chip sets used by handsets in China, the world's biggest smartphone market as Chinese telecom firms invest $16.4 billion in equipment for 4G networks. Under China's anti-monopoly law, the NDRC can impose fines of between 1 and 10 percent of a company's revenues for the previous year. Since Qualcomm earned $12.3 billion in China for its fiscal year ended September 29 that could be a serious amount of dosh. The fine could be even higher if Qualcomm fails to make concessions in its talks with the NDRC. http://news.techeye.net/business/qua...a-china-crisis

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