Ericsson faces antitrust investigation in India: sued for patent fees too high

The Wall Street Journal reported in Thursday that Ericsson had been subjected to an antitrust investigation in India, the main content of which was whether the company had a high standard and a discriminatory problem in charging for patent licensing for mobile technology.

The survey involved patents held by Ericsson on technology related to low-cost handsets, smartphones and tablets. Micromax Informatics LTD, India's third-largest handset maker, complained that Ericsson used its monopolistic position in the market to charge mobile phone manufacturers exorbitant royalties.

Ericsson said in Thursday that the company would fully cooperate with the Indian authorities ' investigation. Micromax did not respond to a request for comment.

The results of the survey could affect the sales and profits of India's dozens of handset makers, which produce and sell cheap handsets using Ericsson technology.

Handset makers, which produce mobile phones and other mobile devices, often need to take advantage of technology that other companies hold and develop. When a technology becomes an industry standard, the patent holder of the technology is required to authorize the use of its technology to others in a fair, reasonable and non-discriminatory principle.

Micromax has been paying Ericsson royalties for 1.25% to 2% of its mobile phone price. The company also pays 2.50 of billions of dollars in patent licensing fees to Ericsson for every network adapter it sells.

The Indian company said Ericsson used its near-monopoly position in the market to charge exorbitant royalties. Micromax, headquartered in New Delhi, also accuses Ericsson of violating the non-discriminatory principle of charging different licensing fees to different companies on the same technology.

Micromax has sued Ericsson for licensing fees to the High Court of Delhi, India (frequent Earl). The court asked the two companies to settle their problems through negotiations, but the negotiations have failed.

Micromax subsequently complained to the Indian Competition Commission, which, after hearing both sides, decided to initiate an antitrust investigation.