Qualcomm is on the verge of "sin and Punishment"

Summary: View the latest quotes Qualcomm is wandering the edge of sin and punishment. According to the information disclosed by the NDRC's website, recently Qualcomm President Derek Aberle has exchanged views and received inquiries from the third rate group to the NDRC on antitrust issues. The survey looked at the latest market at the end of November last year

Qualcomm is on the verge of "sin and punishment".

According to the information disclosed by the NDRC's website, recently Qualcomm President Derek Aberle has exchanged views and received inquiries from the third rate group to the NDRC on antitrust issues. The survey, which started late last November, has been 8 months so far, and the recent market transfer of Qualcomm will be criminalized and may face the biggest penalty since 2009.

In the early 2013, Samsung, LG and other panel manufacturers, because of price monopoly, the first time in China was fined 350 million yuan. As a mobile phone chip faucet Qualcomm, this time can escape a robbery?

Empty dialog

Qualcomm is the world's largest handset chip enterprise, but because the business is mainly aimed at B-side (enterprise), so the handset consumer has not aroused much attention, but the antitrust case launched at the end of last year, the Qualcomm to the front.

February 19, the NDRC officials confirmed for the first time that a antitrust investigation is underway, and said the investigation began last November, because the NDRC received "relevant enterprises, associations reported."

According to the latest information released by the NDRC, July 11, Qualcomm's president of the third-rate group to the NDRC, the issue of antitrust investigation on the exchange of views and inquiries. Since the launch of the survey last year, Derek Aberle has been to the NDRC on April 3 and May 8, respectively, two times.

For the previous two surveys, the NDRC has been secretive, did not disclose more details, but simply said that the two sides on the antitrust investigation and other related issues "exchange of views", in the May 8 survey, "Qualcomm explained, and said that actively cooperate with the investigation, and strive to find ways to solve the problem." ”

The latest announcement of the NDRC, for the first time, details some of the problems that Qualcomm is suspected of violating the anti-monopoly law, including the use of the machine as the basis for calculating the license fee, the binding of the standard necessary patent and non-standard necessary patent, the licensee's free anti-license, the continued charge for the expired patent The patent license and the sale chip bundle, refuses to the chip production enterprise to carry on the patent license, as well as in the patent license and the chip sale to attach the unreasonable transaction condition and so on suspicion illegal behavior.

The announcement also shows that the NDRC authorized personnel to carry out on-site investigation, and produced a query record.

However, there is still no relevant information disclosure on the issue of "confirming the monopoly facts" outside the rumor. Meanwhile, Qualcomm Chinese officials said in an interview that antitrust information needs to be passed through the United States, and there is no official response.

Coincidentally, Qualcomm CEO Mollenkov recently visited China, the third time since his March assignment. Mollenkov did not respond to antitrust issues, but announced that it would launch a maximum of $150 million trillion to support the development of Chinese start-ups, and said that "the Chinese government is actively promoting the development of the local semiconductor industry and Qualcomm is willing to support the Chinese government." ”

But at the latest quarterly press conference, the high general rules released another signal.

The company claims that the fee for licensing fees in China has been hampered by its third-quarter earnings and may also be affected in the coming quarters. Qualcomm also noted that many Chinese manufacturers were missing handset sales, while others failed to reach a licensing agreement with Qualcomm.

Derek Aberle said that Qualcomm's third-quarter revenue was $6.81 billion, up 9% from $6.24 billion a year earlier, with a net profit of 2.24 billion dollars, up 1.58 billion from the same period last year. Qualcomm's shares fell 5% per cent after the July 24 close, despite expectations of the season, which exceeded Wall Street expectations.

Prior to this, Qualcomm executives have repeatedly said that with the advent of 4G, China's chip and licensing business will face a new round of growth opportunities. But now, as the antitrust case fades, the desire to pass is delayed.

The ruin of patent fee

"For domestic enterprises, can not be said to discriminate, but the number of differences." Wang, director of research at Isuppli China, told reporters that Chinese companies have slightly higher patent costs for Qualcomm than companies such as Nokia and Apple.

Wang Introduction, Qualcomm business model is based mainly on three parts: first, licence licensing fees, similar to the cost of joining, manufacturers to develop mobile phones on the Qualcomm platform, Qualcomm to provide the corresponding software development platform and technical services support, a one-time fee, the cost of hundreds of thousands of dollars to millions of dollars, and then the Qualcomm chip costs, The use of Qualcomm chips, the price of 10 U.S. dollars-20 U.S. dollars, and finally the manufacturers in the mobile phone for the market after the need to pay a patent fee for Qualcomm, "this piece of the general proportion of 5%." ”

It is noteworthy that because Qualcomm has a large number of core patents, many manufacturers are difficult to circumvent. Even if you do not use a Qualcomm platform to develop mobile phones, such as the use of Bo Tong, Marvell, MediaTek and other chip manufacturers, but also pay royalties, even if these third-party chip schemes and Qualcomm has a licensing agreement.

However, Wang stressed that the ultimate need for manufacturers to pay royalties, or depends on the core patent areas of the right to speak. Nokia, for example, because of the core patent, its payment to Qualcomm's patent cost ratio of about 3%, domestic enterprises such as Huawei and other core patents, patent costs relatively low, but like Oppo, Vivo and other brands have no core patents, the delivery of Qualcomm's royalty rate is 5%. ”

"This 5%, similar to the factory price of the handset manufacturer, that is, the price before entering the retail channel." "Wang said, in addition to the patent ratio, the basis for collecting base, domestic manufacturers also have disadvantages, whether Huawei or other handset manufacturers, the base is based on the factory price. By contrast, some big-name manufacturers, such as Apple, are relatively reasonable, charging a base for cost.

Wang For example, the iphone, for example, if the cost of the price link at Foxconn is 300 U.S. dollars, Apple sold 600 U.S. dollars, royalties are based on 300 U.S. dollars. "This is much lower than at home. ”

In view of this anti-monopoly, Wang that still need legal definition. For Qualcomm, however, there may be two options, one to adjust the ratio and base of patent authorization, or to accept a certain fine. "The final market situation still requires the parties to negotiate with Qualcomm." ”

However, some market participants are not optimistic about the anti-monopoly.

Sun, deputy general manager of Saino, a market research firm, said the alleged antitrust investigation "would not have any special consequences." "Qualcomm has a large number of core patents, in China is also the proportion of traffic, if not open to the Chinese market," can be made in China Mobile phones are only a few domestic handset manufacturers. Instead, the survey highlights the importance of intellectual property.

He also said that because the chip-related business is only a small part of the handset, "it is expected that this survey will have no effect on consumers, no matter what the end result." ”