Tag: anti-trust

South Korea snaps on Qualcomm antitrust dragon

qualcomm-snapdragonSouth Korea’s Fair Trade Commission is investigating Qualcomm, adding to more antitrust woes for the US chipmaker.

The outfit had a record fine it agreed to pay in China, and claimed that other antitrust authorities would see its actions differently.

South Korea’s Maeil Business newspaper, without citing direct sources, reported that the commission will look into whether Qualcomm is abusing its dominant market position.

As part of its investigation, the commission plans to send inquiries to domestic smartphone makers such as Samsung and Intel.

Qualcomm is also dealing with antitrust probes in Europe and the United States. In their investigation of Qualcomm, Chinese antitrust officials had met with their South Korean counterparts.

In 2009, South Korea’s Fair Trade Commission fined Qualcomm more than $200 million for abusing its dominant market position, so it will be especially interested because the outfit has previous form.

Canada investigates Apple for antitrust antics

mountie-maintain-rightThe fruity cargo cult Apple has managed to fall foul of Canada over the way that it used its market power to kill off rivals.

The Federal Court of Canada agreed to order Apple’s Canadian subsidiary to turn over documents to the Competition Bureau to help investigate whether Apple unfairly used its control of suppliers to kill off competition.

The Competition Bureau said agreements Apple negotiated with wireless carriers may have cut into competition by encouraging the companies to maintain or boost the price of rival phones.

Under the order, Apple will have 90 days to turn over the documents, which include agreements it has reached with Canadian mobile carriers.

Competition Bureau lawyer Derek Leschinsky said Apple lawyers have threatened the company might launch a constitutional challenge of the right of Canadian courts to force Apple’s wholly owned Canadian subsidiary to turn over records held by the California-based parent company.

In other words, its lawyers were not going to tackle the problem of its anti-competitive behaviour, just that it has a right to do what it likes because it is a US company and did not have to hand over any incriminating documents.

Leschinsky pointed out that the provision of the Competition Act that gives Canadian courts the power to compel the production of documents held outside Canada has never been found to be unconstitutional.

Chief Justice Crampton agreed there is increasing legal consensus around the world that such provisions are legitimate.

Apple engineer admits blocking rivals

two-applesA former iTunes engineer told a federal antitrust case he was involved in a project “intended to block 100 per cent of non-iTunes clients” and “keep out third-party players” that competed with Apple’s iPod.

Plaintiffs subpoenaed the engineer, Rod Schultz, to show that Apple tried to suppress rivals to iTunes and iPods. They argue that Apple’s anticompetitive actions drove up the prices for iPods from 2006 to 2009. They want $350 million in damages, which could be tripled under antitrust laws.

Schultz said he was an unwilling witness and did not want to talking about his work on iTunes from 2006-2007, part of which was code-named “Candy”.

However, in 2012 Schultz wrote an academic paper citing “a secret war” Apple fought with iTunes hackers. In the paper, he wrote, “Apple was locking the majority of music downloads to its devices.” Judge Yvonne Gonzalez Rogers did not admit the paper as evidence in the case.

Outside the courtroom, Schultz said the early work of his former team reflected the digital-music market’s need for copyright protections of songs. Later, though, he said it created “market dominance” for the iPod.

Schultz was the final witness in the case after a 10-year legal battle. The testimony has offered a view into how digital music evolved in the mid-2000s as Apple co-founder Steve Jobs and other Apple executives were shaping technology and a new marketplace.

Apple argues, and Schultz agreed, that it released many improvements to iTunes, and not isolated changes to stifle competition. Apple says the security measures that Schultz worked on were designed to protect its systems and users’ which would have been compromised by other players and file formats.

Judge Rogers said she plans to send the case to the jury early next week.


Apple faces antitrust investigation by Canada

watchdogCanadian antitrust watchdogs are about to sink their teeth into the ample rump of the fruity cargo cult Apple.

Canada’s Competition Bureau is investigating allegations that Apple Canadian unit used anti-competitive clauses in contracts with domestic wireless carriers.

The CCB has insisted that it has found no wrongdoing by Apple’s Canadian arm so far, and is not naming the person who laid a complaint. The Tame Apple Press is claiming that the watchdog has no evidence that Apple has contravened any rules and that it has not filed any application with the Competition Tribunal or any other court to seek remedies for any alleged anti-competitive conduct.

However, it is early days yet. The bureau sought a court order to compel Apple to turn over records relating to the ongoing investigation.

Canada’s antitrust watchdog has also been carrying out a similar probe into the country’s top grocer, Loblaw, ordering some of the chain’s major suppliers to hand over records relating to their dealings with the company.

“Should evidence indicate that the Competition Act has been contravened, the Commissioner will take appropriate action,” said Greg Scott, a spokesman for the bureau, in an email.

The bureau did not state whether it has also approached Canada’s largest telecom players for records related to its probe.

Apple has been doing badly out of anti-trust investigations. This year it lost a case where it ran a cartel with several book publishers with the aim of killing off Amazon.


Apple antitrust case continues

courtroom_1_lgThe Tame Apple Press is aghast after a court decided that Apple’s antitrust antics were so important that a class action against the company could continue even if all the official plaintiffs had been ruled as inadmissible.

Apple lawyers managed to prove to the court that none of the official plaintiffs had owned an iPod 10 years ago and therefore could not have suffered from its competition snuffing DRM. So far it has not had to prove that it did anything anti-competitive, and was hoping to win on a legal technicality.

But the billion-dollar class-action lawsuit against Apple is expected to continue after a 65-year-old Massachusetts business consultant read about the plaintiffs’ floundering case online and volunteered to represent consumers in the suit.

A federal judge said she was tentatively satisfied with a proposal to add Barbara Bennett, the new named plaintiff, in the lawsuit over Apple’s iTunes software and the price of its iPods.

Plaintiffs are claiming that Apple’s restrictive software froze out competitors and allowed Apple to sell iPods at inflated prices. They are seeking $350 million (£224m) in damages, which could be tripled if the jury finds Apple broke federal antitrust law.

Apple stopped using the particular software in question in 2009, which means the lawsuit only covers iPod models bought between September 2006 and March 2009.

Each time an Apple user with non-iTunes music tried to sync their devices, between 2007 and 2009, the tech firm urged them to restore the players to factory settings which the plaintiffs claimed was a deliberate move to wipe the rival files, and cause the users’ music libraries to ‘blow up.’

Bennett, who sometimes used her iPod to listen to music while ice skating, boarded a plane early flew to California at the request of lawyers who are suing Apple. She told the court she bought a special-edition iPod Nano in 2006 because she liked its striking red case.

The Tame Apple press has been doing its best to cover up this set-back for Apple’s defence team.  The Daily Mail has been waxing lyrical about how the defence dug up Steve Jobs to testify by video.

“Legendary Apple CEO Steve Jobs held an Oakland courtroom transfixed as attorneys played a video of his testimony in a class-action lawsuit that accuses Apple of inflating prices by locking music lovers into using Apple’s iPod players,” mused the Mail.

“Looking gaunt and pale, Jobs spoke softly during the deposition he gave six months before his death in October 2011. Despite this, he gave a firm defense of Apple’s software, which blocked music from services that competed with Apple’s iTunes store,” it added.

What the Daily Mail did not say was that Jobs had form for anti-trust behaviour and was not the best witness.

Fortune magazine was even more overt in its defence of Apple  under a headline “How dumb is this Apple lawsuit?” Fortune claimed that the case was proceeding for the benefit of lawyers and not consumers. Although Fortune did not say how supporting the actions of a convicted monopoly like Apple over a consumer law-suit benefits the consumer either.  It seems that Fortune no longer favours the brave.

IPod DRM court case could collapse on technicality

novità-apple-2013After ten years trying to get an antitrust case against Apple to court, the case might collapse because the plaintiffs can’t prove they ever bought an iPod.

The antitrust case was messy and would have bought a fair few skeletons out of the closet proving that Jobs’ Mob had done its best to kill off rivals with some dirty deeds ordered by its Messiah Steve Jobs.

The case is so old that Jobs even recorded a video testimony defending his actions. The lawsuit covers iPods purchased between September 2006 and March 2009. Lawyers representing both consumers and businesses claim that the restrictions meant Apple could inflate the prices of iPod in an anti-competitive manner. They are seeking $350m in damages, which could be tripled under US competition laws.

However, now it seems that he case might get chucked out on a technicality. Lawyers for Apple have raised a last-minute challenge saying new evidence suggested that the two women named as plaintiffs may not have bought iPod models covered by the lawsuit.

Apple lawyers checked the serial number on the lead plaintiff’s iPod Touch and found it was bought in July 2009. The other main plaintiff, Melanie Wilson, also bought iPods outside the relevant timeframe, they indicated.

Judge Yvonne Gonzalez Rogers said at the end of the trial’s third day of testimony in Oakland, California said she was concerned that she did not have a plaintiff.

Lawyer Bonny Sweeny said that her team was checking for other receipts. She conceded that while Ms Wilson’s iPod may not be covered, an estimated eight million consumers are believed to have purchased the affected devices.

It is a pity as so far it has emerged in the trail that between 2007 and 2009, if an iPod owner tried to sync their device with iTunes and had music from another digital store on the device, they would receive an error message telling them to restore their iPod to factory settings. This effectively wiped all non-iTunes music from the device.

Apple maintained at the trial that the software and restrictions were necessary to protect users from malicious content and hackers.

Qualcomm has China crisis

china-syndrome-one-sheet1Qualcomm is facing a little trouble in Big China as it is starting to look like its antitrust investigation is going pear shaped. Meanwhile problems collecting royalties could harm its business in China next year.

To make matters worse it is facing similar investigations in the United States and Europe.

Qualcomm should be making a large profit in China. The country is expanding high-speed 4G network is driving demand for smartphones with leading-edge technology.

But it looks like Qualcomm could face a fine of more than $1 billion in China as a result of the National Development and Reform Commission (NDRC) investigation, and the company could be forced to make concessions that would hurt its highly profitable business of charging royalties on phones that use its patents.

Qualcomm admitted that it faces a new probe by the European Commission about rebates and other financial incentives in the sale of its chips. Another preliminary investigation by the U.S. Federal Trade Commission concerns a potential breach of licensing terms.

Qualcomm President Derek Aberle said that his company was co-operating with the Chinese to come up with potential ways to resolve the problem.

Qualcomm has also been struggling to collect licensing revenue from some device makers in China, including local manufacturers the US chipmaker has done little or no business with in the past.

But the fear is that concessions on royalties that Qualcomm is forced to make in China could spread to manufacturers in other countries.

Qualcomm said it was difficult to predict the outcome of the U.S. and European investigations.

The European probe is separate from a four-year-old complaint to the European Commission from a subsidiary of Nvidia over alleged patent-related incentives and exclusionary pricing by Qualcomm.

Qualcomm forecast revenue for fiscal 2015 of between $26.8 billion and $28.8 billion. Analysts on average expected $28.91 billion.

The chipmaker reported revenue of $6.69 billion for its fiscal fourth quarter, ended Sept. 28, up 3 percent from the year-ago period. Analysts on average had expected $7.016 billion.

Qualcomm posted fourth-quarter net income of $1.89 billion, up 26 percent from a year ago.

Nokia deal created anti-trust issues for Microsoft and Samsung

samsung-hqSamsung has told a court that its collaboration with Microsoft on Windows phones raised antitrust problems once Microsoft bought Nokia’s handset business.

The filing comes from Microsoft’s lawsuit accusing Samsung of breaching a business collaboration agreement. It claimed that Samsung still owes $6.9 million in interest on more than $1 billion in patent royalties it delayed paying.

However Samsung said the Nokia acquisition violated its 2011 deal with Microsoft because it effectively required the sharing of secret information with a rival.

Samsung said it agreed in 2011 to pay Microsoft royalties in exchange for a patent license covering Samsung’s Android phones.

Samsung agreed to develop Windows phones and share confidential business information with Microsoft as part of that collaboration. Microsoft said it would reduce the royalty payments if Samsung met certain sales goals for Windows devices.

Once Microsoft acquired Nokia, it became a direct hardware competitor with Samsung, the filing said, and the South Korean company refused to continue sharing some sensitive information because if it had done so it would have breached US antitrust laws.

The agreements, now between competitors, invited charges of collusion,” Samsung said in the filing.

Antitrust regulators in the United States and other countries have approved Microsoft’s Nokia acquisition.

Microsoft. Explain yourself!

bad-dogThe Chinese government has told Microsoft to explain to its finest antitrust watchdogs why it is an imperialist software outfit hell bent on playing monopoly behind the bamboo curtain.

It is giving Microsoft 20 days to come up with an answer which does not involve a dog eating its homework, the monopoly was being played when Microsoft got there, or the Chinese antitrust laws were chewed by Steve Ballmer who thought they were food.

A Chinese antitrust regulator is apparently concerned that Windows operating system and Office software suite is not compatible with other forms of software, which is a surprising new thing that no one appeared to have noticed given that the nation has run on pirated Windows XP for decades.

The State Administration for Industry and Commerce (SAIC) repeated that it suspected the company has not fully disclosed matters relating to the compatibility of the software and the operating system.

In a statement, Microsoft said it was “serious about complying with China’s laws and committed to addressing SAIC’s questions and concerns”.

Microsoft is one of at least 30 foreign companies which have been put under the Chinese water torture as the government seeks to enforce its six-year old antitrust law. Critics say the law is being use to kick foreign businesses out of the country, while it builds its own homegrown IT industry.

Last month, a delegation from chipmaker Qualcomm Inc (QCOM.O), led by company President Derek Aberle, met officials at the National Development and Reform Commission (NDRC).

NDRC claimed the US chipmaker is suspected of overcharging and abusing its market position in wireless communication standards.

Microsoft’s Satya Nadella is expected to make his first visit to China as chief executive later this month and will probably tell the Chinese what is going on.

Microsoft faces China crisis

china-syndrome-one-sheet1Things are not shaping up well between Microsoft and the Chinese government.

A Chinese antitrust watchdog growled that Redmond had not been fully transparent with its sales data on the software it distributes in China.  It is particularly interested in the information regarding the sales of its media player and Internet explorer.

Zhang Mao, the head of the State Administration for Industry and Commerce (SAIC), told reporters at a briefing in Beijing that after multiple meetings including at high levels, Redmond had “expressed a willingness” to respect Chinese law and collaborate with investigating officials.

Western companies operating in China must be finding the whole thing fishy. The Microsoft investigation comes amid a spate of anti-trust probes against foreign firms in China, including Qualcomm and Mercedes-Benz.  Word on the street is that the Chinese are looking to damage foreign companies.

Earlier this month the Chinese claimed that Microsoft was suspected of violating China’s anti-monopoly law since June last year in relation to problems with compatibility, bundling and document authentication for its Windows and Microsoft Office.

The SAIC is one of China’s three anti-monopoly regulators and raided Microsoft offices in several major cities. It had a quiet world with Microsoft Deputy General Counsel Mary Snapp.