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Last Updated: Monday, 1 October 2007, 14:37 GMT 15:37 UK
Qualcomm faces competition probe
A mobile phone with cover removed
Overly high royalties could push up handset prices
The European Commission is to investigate US firm Qualcomm over claims it abused its dominant position in the mobile phone technology market.

The EU competition regulator said it was examining claims that the chipmaker licensed rights to third-generation cell phone technology on unfair terms.

Tech giants Ericsson, Nokia, NEC, Texas Instruments, Broadcom and Panasonic made the complaints to the Commission.

The move was expected and comes almost two years after the initial complaint.

It also comes two weeks after the Commission scored a major victory against software giant Microsoft in similar proceedings that centred on abuse of dominant market position.

The complaints are without merit and are motivated by commercial considerations of the entrenched complainants
Steve Altman, president of Qualcomm

The EU's top court threw out Microsoft's appeal against a landmark antitrust ruling by Brussels that dates back to 2004.

The Commission said it will conduct an in-depth investigation of the claims against Qualcomm - a process which can take months or even years.

'Without merit'

Qualcomm stressed the Commission's decision did not imply conclusive proof of any infringement.

"We welcome the continuation of our dialogue with the Commission in order to demonstrate that the complaints are without merit and are motivated by commercial considerations of the entrenched complainants," president Steve Altman said in a statement.

The group dominates the market for chips in US mobile phones, and sells licenses and chips for new phone technologies in Europe.

The companies that complained said overly high royalties could push up handset prices for consumers, hamper development of the 3G standard and lead to problems with future phone technology.

They also said Qualcomm was trying to exclude rival chip manufacturers from the market.

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