Qualcomm Gets Fined €242 Million by the European Union

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The European Union is opening a new front in its quest to more closely regulate big tech companies, saying Wednesday it was investigating whether US online giant Amazon uses data from independent retailers to gain an illegal edge when selling its own products.

The usage of seller data in allocating coveted 'Buy Box' status, whereby retailers receive prominent placing on the marketplace webpage and customers are able to add items directly to their shopping carts from selected retailers.

"EU competition rules do not prevent companies like Qualcomm from offering low prices for their customers", Vestager explained during a press conference, "but they can not sell below cost with the intention of eliminating a competitor".

"Baseband chipsets are key components so mobile devices can connect to the internet", Margrethe Vestager, the EU Commissioner in charge of competition, said in a statement.

The investigation was formally opened on July 16 2015 and particularly looked at Qualcomm's behaviour in the late 3G/UMTS and early 4G era where it held a commanding lead over other vendors in supplying modem chipsets.

Amazon told Business Insider in a statement that the company plans to "cooperate fully with the European Commission and continue working hard to support businesses of all sizes and help them grow".

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The commission said the announcement of the investigation did not prejudge the outcome.

Vestager stated that she would be taking a "very close look" at Amazon's "dual role", as both a merchant and a seller.

House Rep. David Cicilline, D-R.I., pressed Amazon associate general counsel Nate Sutton on whether the e-commerce giant engaged in a "conflict of interest" in hosting third-party sellers in its marketplace while also selling its own branded products.

Winning the "Buy Box" appears to be key for merchants, as it is involved in the vast majority of transactions. "So how do they treat the data that they get from the little guy?"

Sutton resisted the notion that Amazon has a monopoly among US retailers, noting that the company holds a 1 percent share of the global retail market and a 4 percent share of the USA retail market.

At the time, Qualcomm controlled roughly 60% market share of the UMTS baseband chipset segment, three times as great as the nearest competitor, though this position was used to kill competition before it had a chance to emerge. In 2015, the European Union opened an investigation into whether Amazon's e-book dominance was hurting competition and looked into a tax deal the company made with Luxembourg.

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