Looking to the Two Sessions
China's growth model, pollution and corruption are just a few of the major issues to be discussed
Current Issue
· Table of Contents
· Editor's Desk
· Previous Issues
· Subscribe to Mag
Subscribe Now >>
Expert's View
Market Watch
North American Report
Government Documents
Expat's Eye
Photo Gallery
Reader's Service
Learning with
'Beijing Review'
E-mail us
RSS Feeds
PDF Edition
Reader's Letters
Make Beijing Review your homepage
Print Edition> Business
UPDATED: March 3, 2014 NO. 10 MARCH 6, 2014
Telecom Giant Under a Cloud
Cellphone chip maker Qualcomm faces an antitrust investigation in China
By Deng Yaqing

Hu Gang, a lawyer for China Consumers' Association, believed Qualcomm was likely to have a heavy fine imposed on them, for the NDRC needs only to prove that Qualcomm earned profits through price-fixing tactics, and such evidence could be quite easily be gleaned and collected from contracts and emails.

Hu claimed the government should focus on creating an open and transparent trade environment to safeguard consumers. Part suppliers like Qualcomm that are in the higher end of the industrial chain can substantially affect product prices, he said.

Its pricing pattern would undoubtedly place a stumbling block on China's road toward the 4G era. If it is established that the company engaged in monopoly behavior, Qualcomm may be forced to make some adjustments, meaning lower production costs for domestic mobile phone vendors, noted Xiang Ligang, CEO of a telecommunications portal website CCTime.


As the proverb goes in the business world, top enterprises set the rules, second-class enterprises build up brands, and inferior ones earn a living by churning out products. In order to remove the obstacles on its 4G path, China needs to depend on itself by developing its own core technologies.

"Now, domestic manufacturers still cannot parallel their overseas rivals in chipset production. Except Huawei, 90 percent of domestic mobile phone makers have to rely on purchases from Qualcomm and MediaTek," Song Yongjun, a chief consultant with Teler Telecom Consulting, told China Quality Daily.

Zhuo Saijun, a senior analyst with Analysys International, argued that the current dispute could be an opportunity for Chinese enterprises to catch up in terms of technology and quality. Only reliable products can help domestic producers to win market recognition.

Beyond that, the related legal system should also be put in place in a step-by-step manner. Before the Anti-Monopoly Law came into existence, small and medium-sized businesses were squeezed by industrial giants. As it was promulgated in 2008, start-ups were given more breathing space.

As NDRC statistics show, in 2013, a total of 34,400 anti-monopoly cases were initiated, with fines reaching a total of 3.13 billion yuan ($510.6 million). "The law will be applied to fight both tigers and flies that violate market competition rules," said Xu Kunlin, Director General of the Bureau of Price Supervision and Anti-Monopoly of the NDRC.

In 2013, six dairy companies, including Mead Johnson Nutrition and Danone SA, and six liquid crystal display panel companies, including Samsung Electronics and LG Corp., had heavy fines imposed on them because of price-fixing and anti-competitive practices.

Last, to overcome the hurdles put in place by Qualcomm, Chinese companies should intensify their efforts in product research and development.

"For Chinese mobile phone vendors, aside from resorting to legal protection, it's essential to blaze a trail by breaking down dependence on overseas technologies and edging their way up the industrial chain," said Huang Xiaopeng, a macroeconomic analyst.

Experts agree that when Chinese manufacturers turn into rule makers or brand creators, China's mobile phone sector will completely bypass the price barriers set by companies such as Qualcomm.

Email us at: dengyaqing@bjreview.com

   Previous   1   2  

Top Story
-More Expectations
-Spending Appropriately
-Crossing the Cultural Divide
-Finding 'Friends'
-Protecting Consumers
Related Stories
-A Speedier Era
Most Popular
About BEIJINGREVIEW | About beijingreview.com | Rss Feeds | Contact us | Advertising | Subscribe & Service | Make Beijing Review your homepage
Copyright Beijing Review All right reserved