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  • "Substantial" evidence accuses Qualcomm of price-fixing in China, but is China secretly “fixing” the chip-maker?

"Substantial" evidence accuses Qualcomm of price-fixing in China, but is China secretly “fixing” the chip-maker?

Posted: , by Luis D.

American chip-maker Qualcomm Inc. has gotten an unfortunate mention in a China Daily report on the expansion of the People's Republic's Antitrust office. Apparently, the company which was recently voted the 13th best place for work in the USA, and has been very successful with its Snapdragon mobile chip-sets, is under investigation for price-fixing by China's National Development and Reform Commission.

The silicone giant is aware of the Chinese antitrust probe since late November, and allegedly collaborated with the NDRC in the investigation, although it states that it hasn't been informed of charges for violating anti-monopoly law. However, Xu Kunlin, head of the department of price supervision at the agency, said that the probe obtained "substantial evidence against" Qualcomm. No further details are available at the moment, as such matters usually are kept confidential.

However, a little digging behind the scenes uncovers an elaborate web of political and business interests, with Qualcomm's market pursuits and Chinese carriers' plans for nation-wide LTE deployment at its core. Allegedly, the three largest Chinese telecoms – China Mobile, China Unicom, and China Telecom are preparing to invest more than $16.4 billion dollars in the infrastructure and equipment needed to deploy LTE networks across the country next year. Seeing that all three of them are state-owned, it's not exactly surprising that the Chinese government will not allow a foreign company to simply show up with its fancy technology and reap an easy fortune.

Too easy, in fact, as according to Alen Lin from BNP Paribas in Hong Kong, Qualcomm is projected to remain the sole chip-set provider whose solutions can support both 3G and 4G handsets, at Chinese market scale, for the first six to nine months of 2014. Other notable manufacturers, such as Broadcom, Intel, Nvidia, and even MediaTek are yet to catch up with competitive products, although the latter is allegedly set to reveal an octa-core LTE-compatible chip-set in January. This is likely to be a game-changer for the growing Taiwanese manufacturer, and another formidable threat to Qualcomm's Chinese pursuits.

While that's hardly enough to scare an enterprising American company away, Chinese government intervention may crack open another can of worms. In recent months, the People's government has increased its efforts to use market power to promote local software and hardware manufacturers. Affiliated organizations have spent nearly $3 billion on buying Chinese mobile chipmakers Spreadtrum Communications Inc and RDA Microelectronics Inc, whose technology competes with Qualcomm's.

With all of this taken into account, the ongoing anti-trust probe suspiciously looks like a government machination to ensure China's technological industry will gain an upper hand in negotiations ahead of the 4G expansion.

Source: China Daily via Reuters, more

17 Comments
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posted on 12 Dec 2013, 11:24 3

1. AppleHateBoy (unregistered)


I wish India's government was this loyal towards it's citizens. China is growing because they have such a good government. Darn it!

posted on 12 Dec 2013, 11:47 5

2. ArtSim98 (Posts: 2218; Member since: 21 Dec 2012)


Sarcasm? Nothing against China, especially the people are very nice and friendly, but the government is just so bad and corrupted. I mean seriously. I wouldn't call it democracy, even if the government it self says so.

posted on 12 Dec 2013, 12:25

6. tacarat (Posts: 115; Member since: 22 Apr 2013)


I wish we could deal with our corrupt politicians the way they do after a full blown corruption scandal.

http://news.bbc.co.uk/2/hi/6286698.stm

posted on 12 Dec 2013, 12:29 3

7. ArtSim98 (Posts: 2218; Member since: 21 Dec 2012)


Lol. Well that's kinda sad. And one thing with China's government is that it won't allow anybody to say No to it. If somebody does, in to the jail he/she goes!

posted on 12 Dec 2013, 23:03

17. tacarat (Posts: 115; Member since: 22 Apr 2013)


Well, that's why I'd only advocate that one, teensy, example ;)

posted on 12 Dec 2013, 20:29

16. vijaysivakula (Posts: 161; Member since: 17 Aug 2011)


How can that be a democracy when they have only one party and a dictatorial style of functioning?

posted on 12 Dec 2013, 11:55 6

3. Taters (Posts: 2584; Member since: 28 Jan 2013)


Funny how huawei and this weak conspiracy article with no facts is taken at face value but when all the sketchy things US companies like Apple and soon to be owned by a US company Nokia pull this sketchy stuff they are only protecting their innovations.

Sure PA, sure.

posted on 12 Dec 2013, 11:57

5. rd_nest (Posts: 684; Member since: 06 Jun 2010)


my thoughts exactly..

+1.5

posted on 12 Dec 2013, 12:30 1

8. PapaSmurf (Posts: 7328; Member since: 14 May 2012)


Nailed it.

+1

posted on 12 Dec 2013, 11:56 4

4. rd_nest (Posts: 684; Member since: 06 Jun 2010)


So, it's all conspiracy when chinese does that. but all fine and dandy when US does this each and everytime. They way they did this against Huawei. Favoring apple against samsung in every case. good that the chinese are doing so. get those suckers out of china and kick their sorry arse badly. these us companies deserve no better. it's a good thing that china has become so powerful now. US will think twice before saying anything against them. and to the author of this article, "go suck it".

you do the same, you should be ready to get the same treatment in reply.

posted on 12 Dec 2013, 15:28 1

11. McLTE (Posts: 637; Member since: 18 Oct 2011)


yeah, because the world really needs a more powerful Chinese government. Not.

posted on 12 Dec 2013, 14:03 4

9. tedkord (Posts: 4275; Member since: 17 Jun 2009)


I just wish all companies would pull out of China totally. Why must we keep appeasing this tyrannical government that practices protectionism, manipulates it's currency and oppresses it's people? China is a parasitic entity. Let it collapse through isolation, and maybe the people will revolt and rebirth the nation as one that is a credit to the world.

posted on 12 Dec 2013, 14:56 2

10. rd_nest (Posts: 684; Member since: 06 Jun 2010)


They should do that first in US. China is among the world's oldest civilization. Whereas civilization and US doesn't mix at all.
They are atleast much better than the slavery system you guys had.

posted on 12 Dec 2013, 15:29 1

12. McLTE (Posts: 637; Member since: 18 Oct 2011)


Haha.. RD.. can I have some of what you are smoking? Seriously.. it must be really good stuff!

posted on 12 Dec 2013, 17:56

15. ollienightly (Posts: 37; Member since: 23 Jul 2013)


So you are saying the cases against Chinese companies like Huawei, ZTE and Lenovo were normal even with absolutely no excuses other than "security concerns" that they can't prove. And what with Qualcomm's de facto monoply as a fact, the Chinese government are doing evil? They could just do the same by quoting the US Prism and save themselves the trouble, and you'll have nothing to say.

What a hypocrite of you!

posted on 12 Dec 2013, 15:45

13. rusticguy (Posts: 2818; Member since: 11 Aug 2012)


Price fixing scandal by foreign companies in China fololowed by Chinese authorities going after them isn't new in China. haven';t you heard of price fixi9ng scandal by milk-formula companies of US in China and how they looted ? Good if any govt gets after cartel and price fixing issues. Milk-Formula giants had toi cust price by 20% in China after they were caught.

posted on 12 Dec 2013, 17:00

14. AfterShock (Posts: 2100; Member since: 02 Nov 2012)


Volatile times ahead.

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