FTC antitrust case against Qualcomm officially starts

Today, in California, the United States Federal Trade Commission’s antitrust case against chipset-maker Qualcomm officially started, via Reuters.

The FTC accuses Qualcomm of abusing a monopoly on mobile chip technology, the company’s bread-and-butter. The outcome of the case could have major ramifications not only for Qualcomm’s business but the smartphone industry at large.

The non-jury trial is expected to last for 10 days. Presiding Judge Lucy Koh will issue the verdict.

If Qualcomm is found to be abusing a monopoly, that verdict will have explosive ramifications for the company and its multiple lawsuits around the world. Qualcomm is engaged right now in several high-profile disputes with Apple, two of which are tipping in Qualcomm’s favor. If this FTC case ends out of Qualcomm’s favor, those other cases could be affected.

Jennifer Milici, an FTC attorney, alleges that Qualcomm abuses its power in the industry. “Qualcomm says you will pay our rates if you want our chips,” she said during opening arguments. “The only way to arrive at a market rate [for Qualcomm’s patents] is to negotiate without that threat.” In other words, Qualcomm has little-to-no competition in these matters, so a fair market rate for its patents cannot be determined.

The FTC also accuses Qualcomm of striking deals with major manufacturers — including Apple — intended to undermine competition from rivals, such as Intel.

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