Intel: Qualcomm pushed us off the modem market

Intel claims that it has had to leave the modem chips market because of the anti-competitive hurdles that Qualcomm created. Intel believes a verdict on Qualcomm’s market-distorting practices should be upheld.

Intel claims that Qualcomm’s behavior in particular is the cause of its exit from the modem chips market this year. Apple acquired Intel’s modem division in July for $1 billion, an acquisition that has cost Intel several billion dollars, the company now reports. The chip giant has said it has invested billions of dollars, hired thousands of people and acquired two companies to succeed in the market, but to no avail. Despite everything, Intel was unable to cope with the artificial and insurmountable barriers to fair competition that Qualcomm created.

Qualcomm’s claim that competitors simply couldn’t offer chips that were good enough, at a reasonable price, is incorrect, according to Intel. Intel would have been unable to sell chips to customers due to its competitor’s practices and Qualcomm would have artificially influenced prices. This would have happened in particular with a ‘no license, no chips’ policy: Qualcomm linked the purchase of chips to a license for patent use. Using modem chips from parties other than Qualcomm, the royalties would be as high as the price of the modems themselves, according to Intel.

Intel expresses its support for the Federal Trade Commission in a letter to the appeals court. The FTC won a case against Qualcomm in May, where the California court ruled that Qualcomm’s licensing practices strangled competition in the modem chip market and harmed competitors, OEMs and consumers. Qualcomm is challenging that ruling in the Circuit Court of Appeals. That case starts in January.