Qualcomm Inc (QCOM)

[khemara_qc]

Qualcomm denies sharp practice

Handbags at dawn as complainants are accused of running scared

Iain Thomson, vnunet.com 31 Oct 2005

http://www.infomaticsonline.co.uk/vnunet/news/2145169/qualcomm-denies-sharp-practice

Wireless firm Qualcomm has hit back at criticisms of its business practices, maintaining that the complainants are scared of its ability to win new customers.

The company said in a statement that, while it has not actually seen the formal complaint, the reported content was "factually inaccurate and legally meritless".

Qualcomm added that it looks forward to fighting the allegations in public process and would "vigorously defend" itself.

"It is not surprising that the reported allegations come largely from entrenched 2G suppliers which have the most to lose from the enhanced and expanded competition in 3G created by Qualcomm's widespread licensing and supply of enabling 3G technology, chipsets and software," said Dr Paul Jacobs, chief executive at Qualcomm.

"The many new handset market entrants, working in co-operation with Qualcomm, threaten the market shares of these entrenched manufacturers and their component suppliers."

Dr Jacobs added that the price of WCDMA handsets is declining and that take-up of the technology is faster than for GSM at its inception.

Haruo Suzuki, director of Panasonic Mobile Communications, one of the complainants, said: "Panasonic MC believes that Qualcomm is charging excessive and disproportional royalty rates in breach of EU competition law and industry requirements to offer licences for essential patents on fair, reasonable and non-discriminatory terms."

Broadcom, Ericsson, NEC, Nokia, Panasonic MC and Texas Instruments all filed their complaints with the EU Competition Commission.

Qualcomm replied that the complaints about royalty rates were unfounded and were "simply complaints about legitimate and lawful price competition".

It also stated that it had never made the purchase of its chips a condition of granting a licence.