The FTC Thinks You Pay Too Much for Smartphones. Here’s Why #That_ItJanuary 12, 2019
But it doesn’t blame handset makers like Apple and Samsung or wireless carriers.
Qualcomm charges companies like Apple a set percentage of the total price of a phone in exchange for the right to use its technology, according to the antitrust suit filed by the FTC.
Apple has been using Intel wireless chips since 2016.
The company says its policy of requiring patent royalty agreements dates back decades, before the company had the market power it does today and that it has not raised its patent royalty rates as its market share has grown as one would expect of a company with a monopoly.
The FTC sued Qualcomm for antitrust violations in 2017, but the case only reached trial this week.
The case is just one of many legal conflicts afflicting Qualcomm since 2015.
Apple also sued the company alleging that Qualcomm had withheld rebates owed to Apple in retaliation for the company’s cooperation with South Korean regulators.
Qualcomm says that it faces more competition in the chip market than ever, and in its legal brief cites a 34 percent drop in the average smartphone price between 2010 and 2017 as evidence that it hasn’t harmed competition.
The FTC suit alleged that Qualcomm didn’t license its technology to competitors.
Qualcomm CEO Steven Mollenkopf told a federal court Friday that the company requires buyers of its chips to also license its patents, but argued that it does so for legitimate business reasons.