Caixin
Dec 02, 2016 07:29 PM
BUSINESS & TECH

Qualcomm Says Licensing Deals with 'Most' China Smartphone Makers Renegotiated

(Beijing) – Leading U.S. telecoms chipmaker Qualcomm Inc. said on Friday it has signed new licensing deals with "most" of China's smartphone brands, following its landmark settlement of a probe by the country's antitrust regulator nearly two years ago.

Qualcomm was fined nearly $1 billion as part of its settlement with China's National Development and Reform Commission (NDRC), which ruled the U.S. company's licensing practices were anti-competitive. As part of the settlement, Qualcomm was required to renegotiate all of its agreements with the many Chinese smartphone makers that use its chips.

Qualcomm has signed new agreements with most of the manufacturers since then, Hou Jilei, a senior director in the company's China-based R&D division, told Caixin on the sidelines of the Caixin Summit on Friday in Beijing.

One notable exception is Alibaba-backed Meizu, which Qualcomm is suing for patent violations in China as well as the U.S. and Europe. Hou declined to comment on the status of those lawsuits, but said that sales with most of its other smartphone vendor partners are "going very well."

China's antitrust probe against Qualcomm marked a major setback for the company, with the NDRC determining the company's licensing practices were excessively restrictive and overreaching. Qualcomm earns about half of its revenue from China, the world's largest microchip market.

In July, the company said it was making progress with its licensing business in the country following the settlement, and expected that momentum to continue. Later it added it was still negotiating with key Chinese manufacturers.

Separately, Hou said that a recently formed Qualcomm joint venture in interior China's Guizhou province was "getting close to manufacturing." He said the venture has most major elements in place, including senior management. Guizhou Huaxintong Semiconductor Technology's formation was announced early this year, with an aim of looking for business opportunities in China's chip market.

Contact reporter Doug Young (dougyoung@caixin.com); editor Poornima Weerasekara (poornima@caixin.com)

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