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Qualcomm's 3G licensing practices challenged
Posted: 28-Oct-2005 [Source: Ericsson]

[Companies file complaints to the European Commission requesting an investigation of Qualcomm's "anti-competitive conduct" in licensing patents for 3G technology.]

Broadcom, Ericsson, NEC, Nokia, Panasonic Mobile Communications and Texas Instruments have each filed Complaints to the European Commission requesting that it investigate and stop Qualcomm's anti-competitive conduct in the licensing of essential patents for 3G mobile technology.

The companies state that Qualcomm is violating EU competition law and failing to meet the commitments Qualcomm made to international standard bodies around the world that it would license its technology on fair, reasonable and non-discriminatory terms. Absent these commitments, the WCDMA 3G standard would not have been adopted.

Qualcomm is infringing these rules by:

- trying to exclude competing manufacturers of chipsets for mobile phones from the market and preventing others from entering. To this end, Qualcomm has committed a number of abuses, ranging from the refusal to licence essential patents to potential chipset competitors on fair, reasonable and non-discriminatory terms to offering lower royalty rates to handset customers who buy chipsets exclusively from Qualcomm.

- charging royalties for its WCDMA essential patents that are excessive and disproportionate; in particular by imposing the same royalty rate on WCDMA 3G handsets as it does for CDMA2000 3G handsets despite the fact that Qualcomm has contributed far less technology to the WCDMA 3G standard than it has to the CDMA2000 standard.

The companies believe that Qualcomm's anti-competitive behaviour has harmful effects for the mobile telecommunications sector in Europe, as well as elsewhere, because carriers and consumers are facing higher prices and fewer choices.

Kasim Alfalahi, Vice President IPR Licensing and Patent Development at Ericsson said: "Qualcomm committed to standard setting organizations that it would license its technology on fair, reasonable and non-discriminatory terms. In spite of this and in breach of competition law, Qualcomm is charging excessive and disproportionate royalties. This means ultimately that consumers may have to pay more than they should for their mobile handsets."

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