Qualcomm confused over Chinese antitrust action

Qualcomm’s CEO Paul Jacobs is a little confused as to why the Chinese coppers would be paying so much attention to his outfit.

He told Reuters that he has still has not been told why Qualcomm’s has come under antitrust scrutiny in China since late last year.

China’s National Development and Reform Commission had launched an antitrust probe into the company in November.

Jacobs is still scratching his head and saying that he does not know why. Although he said that it was not unusual for authorities in various countries not to disclose reasons for their antitrust probes. He said that Qualcomm has handed over requested documents to the NDRC.

The Chinese NDRC has launched nearly 20 pricing-related probes of domestic and foreign firms in the last three years. But in December, state media quoted a senior official at the NDRC saying the regulator had “substantial evidence” against the chipmaker.

Word on the street is that the government may be trying to give Qualcomm a Chinese burn so that it can have some leverage in royalty negotiations. Other suggestions re that it is support local suppliers trying to compete with Qualcomm. The country is moving to 4G and Qualcomm is a world leader in the technology.

The Chinese government spent nearly $3 billion to buy Chinese mobile chipmakers Spreadtrum Communications and RDA Microelectronics. Both companies have technology that competes with Qualcomm’s.

Jacobs said that China had a couple of chipset manufacturers that just got bought by a government university so “there were all sorts of dynamics going on”.