Qualcomm is the biggest supplier of LTE chips that are used in smartphones all over the world, but that position is now threatened. Contrary to what you may think, the threat to this stand is not because of their competition in the market, but a move by the EU to see the company fined for employing anti-competitive measures in keeping its stand in the market.
Unlike underdeveloped or developing economies where a company or firm can pursue monopoly by any means possible in a market, developed countries have a law in place to guard against that. Should it be seen that a company is looking to make excess profits or impose itself onto the market in unorthodox ways, the excesses of such a company would be curbed.
According to a statement that has been released by the EU,
Qualcomm illegally shut out rivals from the market for LTE baseband chipsets in over five years, thereby cementing its market dominance.’
The Competition Commissioner for the EU, Margaret Vestagar, continued that
Qualcomm pad billions of US dollars to a key customer, Apple, so that it would not buy from rivals. These payments were not just reductions in price – they were made on the condition that Apple would exclusively use Qualcomm’s baseband chipsets in all its iPhones and iPads.
This meant no rival cold effectively challenge QUALCOMM in this market, no matter how good their products were.
While this claim might be true, Qualcomm might have two points in making an appeal for themselves if they ever hope to get out of the $1.23 billion equivalent fine that has been slapped on them.
For one, Apple does not exclusively use the Qualcomm LTE chipsets in its iPhones, although that takes the bulk of the production. Again, some reports point out that the iPhone units that have an Intel chipset in them run slower than those with Qualcomm chips.
For now, Qualcomm will hope to get out of this rut and keep their market dominance alive, al in the same breath.