[A2k] BBC: Qualcomm to pay record $975m in China antitrust case

Thiru Balasubramaniam thiru at keionline.org
Tue Feb 10 01:18:06 PST 2015


http://www.bbc.com/news/business-31335551
10 February 2015 Last updated at 00:54 GMT
Qualcomm to pay record $975m in China antitrust case

US chipmaker Qualcomm will pay $975m (£640m) to Chinese authorities to end
a 14 month anti-trust investigation into its patent licensing practices.

The fine is the largest in China's corporate history and will require the
firm to lower royalty rates on patents used in China's mobile phone market.

The move could help Chinese smartphone makers Xiaomi and Huawei.

Qualcomm said on Monday it would not contest the ruling that it violated
China's anti-monopoly law.

"Although Qualcomm is disappointed with the results of the investigation,
it is pleased that the NDRC (National Development and Reform Commission)
has reviewed and approved the company's rectification plan," the tech giant
said in a statement
<http://files.shareholder.com/downloads/QCOM/3864235320x0x808060/382E59E5-B9AA-4D59-ABFF-BDFB9AB8F1E9/Qualcomm_and_China_NDRC_Resolution_final.pdf>
on
Monday.
Stake in China

The firm, which is the biggest supplier of chips used in smartphones, will
now charge royalties based on 65% of the selling price of phones in China,
instead of on the entire price.

China's expanding high-speed 4G network is driving demand in the world's
largest smartphone market, where Qualcomm as a key player.

The chip giant made about half its global revenue of $26.5bn in China in
its last fiscal year.

News of the agreement sent the company's New York listed shares up 2.8% in
after-hours trading.

The firm also increased its profit and revenue forecast for the current
fiscal year.

Chief executive Steve Mollenkopf said he was pleased the resolution had
removed "uncertainty" surroundings its business in China.

"We will now focus our full attention and resources on supporting our
customers and partners in China and pursuing the many opportunities ahead,"
he said.



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