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| UPDATED: 2006-07-03 |
 Qualcomm Sued Over Korean Business 
By: David Utter 2006-07-03 Texas Instruments and Broadcom filed an antitrust action against another semiconductor maker, Qualcomm, and alleged the company has abused its position as market leader in South Korea.  There is a strong likelihood that the cellphone you wouldn't dream of leaving home without has a Qualcomm (QCOM) chip at its heart. Qualcomm created the Code Division Multiple Access (CDMA) standard for cellular communication, and as the technology's inventor has enjoyed receiving licensing fees for CDMA from other chipmakers.
An AP report has noted a couple of US firms have challenged Qualcomm over its South Korean business. Texas Instruments (TXN) and Broadcom (BRCM) believe Qualcomm offers better licensing terms for its technology to cellphone companies that also purchase chips from it. Since a cellphone maker using CDMA will have to pay those royalty fees anyway, Qualcomm's ability to enhance its hardware business by discounting the licensing side would provide the company with tremendous marketing power. The plaintiffs allege this is taking place. The lawsuit against a market leader in the semiconductor industry parallels a higher profile action playing out in the United States. AMD (AMD) sued Intel (INTC) in June 2005 over anti-competitive actions. AMD has accused Intel of using tactics like bribery and coercion to tighten its stranglehold on the semiconductor marketplace. There have been signs that Intel's status as the market power has started showing cracks in its facade. Intel's shareholders voiced their displeasure with the company in May 2006 over its stock price. CEO Paul Otellini vowed to review every facet of Intel's business to improve its performance. AMD has been doing what it can to claw its way into a stronger market position. Its long-time arrangements with Hewlett-Packard have seen H-P carve away some of market leading PC maker Dell's business. Dell finally inked a deal with AMD that would place its Opteron processors in some of Dell's servers, the market segment where H-P has made its gains. --- Tags: Qualcomm, Texas Instruments, Broadcom Add to  Del.icio.us |  Digg |  Yahoo! My Web |  Furl
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View All Articles by David Utter About the Author: David Utter is a staff writer for InternetFinancialNews and WebProNews covering technology and business. |
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