European Union fines Qualcomm $272M for 'predatory' pricing
- by Claude Bryan
- in Markets
- — Jul 19, 2019
This is the latest push in the expanded focus by European and USA authorities on how tech giants - Google, Facebook, Apple and Amazon - use the data of people and businesses that rely on their platforms. Some U.S. politicians and even one of Facebook's co-founders have called for them to be broken up.
"Qualcomm's strategic behaviour prevented competition and innovation in this market, and limited the choice available to consumers in a sector with a huge demand and potential for innovative technologies", European Union competition commissioner Margrethe Vestager said in a statement. This may be good for mobile phone manufacturers and consumers in the short term, but in the long term, when the competition is finally pushed out of the market, prices would rise significantly, wouldn't they?
Reuters reported on Wednesday that Amazon has already agreed to cooperate fully with the investigation. The commission has ordered an antitrust investigation into its dealings with third-party merchants. Last year, Vestager announced her office was looking into whether Amazon uses its position to gain an edge over third-party sellers in its marketplace. According to published reports, usa regulators are poised to fine Facebook $5 billion for that scandal, but the wider debate of reining in tech companies' powers has only just begun.
The EC argues that Amazon has a dual role: It sells products on its own marketplace and it provides a platform for independent retailers to sell through Amazon, too.
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Turkey responded by saying the equipment is necessary for securing the country's southern border with Syria and Iran. Turkey has the second-largest army in North Atlantic Treaty Organisation , a 29-member military alliance.
Amazon, she continued, is able to "decide who can be there, which companies show up well in the search results, and they can use the information that they glean from the companies that are riding on their platform in order to undermine them as competitors". "The algorithms are optimised to what customers want to buy regardless of the seller", he said. She said pushing the probe forward will give officials a way to impose a fine to the company if investigation findings point to unfair practices.
"There have been concerns around the world that competition authorities have failed to appreciate the market power that comes from ownership of data", he said. Although pushback in some of Amazon's largest global markets is underway, the retailer's power is only beginning to draw concerted attention in the United States.
Aside from Amazon, there may be another company that will be slapped with fines from the bloc: Qualcomm Inc.
Amazon and the European Commission did not immediately respond to Business Insider's requests for comment. Two years ago, it was told to pay back taxes of about 250 million euros to Luxembourg because of illegal tax benefits.
