Qualcomm Slapped with US$208-Million Fine by the KFTC

It would seem that Intel isn't the only leading company that has abused of its position and practices an anticompetitive business policy, to the detriment of its competitors. According to a recent report, Qualcomm, the U.S. wireless chip and technology company, has just been slapped with a US$208-million fine from the South Korean anti-trust agency. The claimed reason behind this decision is that the chip maker has reportedly been discriminating against companies using products from its competitors.

According to a recent news article on Reuters, the Korean Fair Trade Commission (KFTC) ruled against Qualcomm this Thursday, following an investigation that has been going on for more than three years. In a recent statement from the Commission, it is mentioned that Qualcomm has imposed higher prices for its chips to companies that used modem chips from its competitors. “When licensing its CDMA mobile technology, Qualcomm levied higher royalties on companies that used modem chips supplied by rival companies,” the Commission said.

The Commission also added that Qualcomm offered rebates to those companies that used its own chips, practices that were said to have helped the U.S. company maintain its near monopoly for more than ten years in South Korea.

Qualcomm, which held a 99.4 percent market share in 2008, stated that it regretted the Commission's decision and that this could hurt the competitiveness of the Korean mobile phone makers. In addition, Qualcomm plans to appeal if the ruling is maintained after the Commission's final statement in the next few months, Reuters reports.

Among the main customers for Qualcomm's chips, LG Electronics and Samsung Electronics are the two most important players. According to analysts, these two could be affected by the ruling against Qualcomm, given that they rely heavily on the chip maker's products for mobile phone standards such as CDMA 2000 and W-CDMA.

Qualcomm is also investigated by the European Commission in Brussels for anticompetitive practices.