China News recently reported that China is conducting an antitrust investigation into the U.S.-based Qualcomm, which is the world’s largest cellphone chip maker. The investigation is focusing on high patent licensing fees and the “handset-based patent pricing model.” Experts in the Chinese cellphone industry have expressed the belief that Qualcomm abused its power of control over its intellectual property by establishing unfair prices and denying competition. Qualcomm holds critical patents that dominate the cellphone chip market and define the wireless communications standard. Based on publicly available data, some lawyers have estimated that, if Qualcomm is found guilty, its total Chinese income, which is half of its global revenue (half of US$20 billion), will be the basis for the fine. There is a good chance that the fine will set a record in Chinese antitrust history.
Source: China News, July 24, 2014