The case for Qualcomm in China is just the beginning.

December 29--The recent end of a China-wide antitrust investigation by Chinese authorities over Qualcomm is likely to exacerbate global regulators ' scrutiny of the company's highly lucrative patent licensing business and may even affect its partnership with smartphone makers such as Apple and Samsung, Reuters reported. In a statement in Friday, China's National Development and Reform Commission said the agency would close its 13-month-long survey of the US chipmaker, the most high-profile case in a number of recent surveys conducted by Beijing against Western companies. Once the antitrust investigation is established, Qualcomm will face record fines and may be forced to change the way patents are granted to Chinese handset makers, according to China's domestic media. With pressure from regulators in other countries to increase, Qualcomm's highly profitable patented technology licensing business will be weakened. Qualcomm said the investigation in Europe and the investigation by the Federal Trade Commission (FTC) could be linked to China's current investigation. "It is no exaggeration to say that Qualcomm is under attack," said Thomas Cotter, a patent expert and professor of law at the University of Minnesota, Thomas Cotte. "No one knows how things will work out, but the FTC will reveal some facts in the survey." Qualcomm declined to comment on the issue. The change in patent costs Qualcomm is a patent holder for many of the top mobile technologies, with patents such as CDMA and LTE becoming industry standards. Qualcomm based on mobile phone sales price authorized royalties, and even some rival chips are also charged fees. The company's net profit in 2014 was $8 billion, more than half of which came from patent licensing. As economic growth slows in the developed world, the smartphone industry is moving to China. The popularity of LTE technology is driving the growth of market demand, now the vast majority of smartphones in the world are produced in China. Previously, China's national Development and Reform Commission has said Qualcomm is suspected of abusing its leading position in the field of wireless communications standards, charging exorbitant patent fees. Industry insiders expect Qualcomm to agree to change the standard of patent fees in the Chinese market, hurting its bottom line for growth in China, the world's fastest-growing and most important market. Qualcomm has a revenue of $26.5 billion trillion in the fiscal year ending September 28, about half of which comes from China. By lowering the fees for patents, the relationship between Qualcomm and manufacturers of Chinese handsets such as Huawei, Lenovo, ZTE and Millet will change, as well as its relationship with global handset makers such as Apple and Samsung. Derek Aberle, Qualcomm's president, was asked at an analyst meeting in November this year to Derrick Abely how the company would reopen negotiations with the biggest authorised party, and how the potential concessions to China would affect those negotiations. At that time Abely did not have a direct answer at the meeting. "If Qualcomm were to reach an agreement with Chinese authorities that would substantially reduce the cost of licensing, it would be issued when it talks to LG, Samsung and AppleGive birth to what? Ascendiant Capital analyst Cody Aicri Cody Acree said, "This will become like a snowball, and it will be difficult for us to see the end." "The survey, which is on the defensive in China, is the latest in a antitrust investigation by Qualcomm," he said. The 2009 Qualcomm was fined $200 million for alleged monopolies in South Korea, and in 2007 the European Commission's antitrust arm filed charges against Qualcomm after it was forced to negotiate a patent license agreement with manufacturers such as Nokia. Some patent experts believe Qualcomm is more difficult to implement software patents because of the recent decision of the US Supreme Court, and that the possibility of a restart of patent reform in Washington is putting Qualcomm on the defensive in the US. According to company documents, the FTC's investigation involved patented technology for industry standards, which could lead to a change in the way patents are licensed. "Not only in China, Qualcomm is facing more problems," said Donald Merino, an intellectual-property expert, Tang Qihao that "it needs to face a devaluation of the patent system in the US." "(Dream)