US tech takes another hit: EU fines Qualcomm for abusing dominance
First Amazon, now Qualcomm. It's been a busy week for tech and antitrust in Europe.
The EU is not averse to handing out fine to powerful tech companies that break the rules.
Europe's Competition Commission has long taken a dim view of tech companies abusing their dominant position to stifle rivals, but this has been a particularly bad week for US tech giants in Europe. One day after announcing an investigation into Amazon, the EU handed a 242 million euro ($272 million) fine to chipmaker Qualcomm for lowering the price of its 3G chipsets to force its competitors out of the market.
In the era of 5G, it may seem odd that the EU is still looking back at 3G chipsets (and issues that occurred between 2009 and 2011), but Qualcomm has been under investigation for four years. The Commission said that Qualcomm forced one competitor, a company called Icera, out of the market, which could potentially have stifled innovation.
"Qualcomm's strategic behaviour prevented competition and innovation in this market, and limited the choice available to consumers in a sector with a huge demand and potential for innovative technologies," Competition Commissioner Margrethe Vestager said Thursday in a statement.
Qualcomm said in a press release that Icera was later acquired by Nvidia for hundreds of millions of dollars, showing that it wasn't harmed in the long run. Don Rosenberg, executive vice president and general counsel of Qualcomm, said the company intends to appeal the fine.
"We cooperated with Commission officials every step of the way throughout the protracted investigation, confident that the Commission would recognize that there were no facts supporting a finding of anti-competitive conduct," he said. "On appeal we will expose the meritless nature of this decision."
Qualcomm's fine marks the second time this week that a US tech company has come under fire from the EU. Vestager announced that the Competition Commission is opening a new investigation into Amazon over its data practices. It also opened an investigation into Apple following a complaint by Spotify earlier this year, shortly after resolving the third of three major investigations that slapped Google with record-breaking antitrust fines.
Vestager, who is due to leave her role as Competition Commissioner this year to take up the position of deputy to the European Commission's chief, has attracted criticism from President Donald Trump for taking US tech companies to task.
Trump accused her of "hating" America, something that she's vehemently denied. According to statements he made last month, Trump believes that US tech companies should be held accountable within the country, but not by Europe. However, US tech companies serve a global audience and have headquarters in Europe, meaning they must abide by local laws.