FTC to monitor Qualcomm over 5G mobile chips
Fair Trade Commission (FTC) Chairwoman Joh Sung-wook speaks during a press conference in Sejong, Thursday. Courtesy of FTC
By Nam Hyun-woo
The Fair Trade Commission (FTC) will closely monitor Qualcomm and other chipmakers for potential unfair practices in the fifth-generation (5G) semiconductor market, the commission's chief said Thursday.
“The FTC will set up a semiconductor team in the first quarter of next year, and closely monitor chipmakers over their potential impeding of rival entrants in terms of 5G chips,” FTC Chairwoman Joh Sung-wook said during a press conference at the FTC headquarters in Sejong.
The remark is in line with her inauguration pledge to closely monitor not only Korean but also global tech giants over their practices that undermine fair market competition.
Last month, the FTC set up a new taskforce specializing in the info-tech industry, and had three teams in charge of online and mobile platforms and intellectual property. The semiconductor team will join them.
She did not single out any specific company, but the remark is widely interpreted as aimed at chip giants Qualcomm and Broadcom.
“Based on past experience, anti-competitive behavior usually occurs during the network standard's transition from 2G to 3G, 3G to 4G,” Song Sang-min, chief of the FTC's anti-monopoly bureau, said during the conference. “Mobile devices require various chipsets and we will monitor companies making those chipsets.”
Qualcomm, which has around 25,000 standard-essential patents in mobile communications, was slapped with a 1.03 trillion won fine ($887.4 million) in 2016 by the FTC, in the wake of the spread of 4G. Then, the FTC said Qualcomm impeded its rivals with its intellectual property strategy, and such practices were against fair, reasonable and non-discriminatory terms.
Qualcomm has been refusing to accept the decision and filed a suit against the FTC, but the Seoul High Court sided with the antitrust agency on Dec. 4, the same day that Qualcomm unveiled its two new Snapdragon mobile platforms focused on 5G in Hawaii.
Along with Qualcomm, industry officials said Broadcom could be on the scope of the FTC.
The European Union ordered Broadcom recently not to apply exclusivity clauses to its six client companies, amid an anti-competition investigation of the U.S. chipmaker.
Along with the closer monitoring on chipmakers, Joh said the info-tech taskforce will handle the monopoly cases of internet giants Google and Naver next year.
In November, the FTC notified Naver that the portal operator is abusing its market dominant status, thus it will impose a fine. The antitrust agency suspects Google of similar charges.