EC commences Qualcomm probe

The European Commission officially launched an investigation into Qualcomm's supposed stranglehold on WCDMA intellectual property.

In October 2005, Broadcom, Ericsson, NEC, Nokia, Panasonic Mobile, and Texas Instruments requested that the EC investigate Qualcomm's alleged anti-competitive conduct in the licensing of essential 3G patents. The companies alleged Qualcomm is violating competition laws and is failing to meet its promise to license its technology on fair, reasonable and non-discriminatory terms.

UBS analyst Maynard Um said the "EC may, among other options, reject the complaints or come to a settlement with Qualcomm. We believe it would be unusual for the EC to mandate royalty rates, particularly given separate agreements already negotiated with the various parties. However, the outcome is difficult to predict. Additionally, given the complexity and potential impact to the related parties, we would be surprised to see a quick resolution."

For more on the issue:
- read Qualcomm's reaction to the EC proceedings

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