Margaret Vestag (Margrethe Vestager), Antimonopoly Commissioner of the European Commission, said: "whether it's work or leisure,televisionSet-top boxes and modems are part of our daily life. We suspect that Broadcom, the major supplier of components for these devices, has imposed contractual restrictions to exclude its competitors from the market. This will stop the customers of Broadcom and ultimately stop the end-users from benefiting from choice and innovation. During the investigation period, we will also ask Bloom to stop its actions in order to avoid any risk of serious and irreparable damage to competition.
According to the European Commission, Botong is the world's largest integrated circuit design, development and supplier of wired communication equipment and a global leader in several markets, including system-on-a-chip (SoC), front-end chips (hardware components that convert analog input into digital output, and then processed by SoC) and WiFi chipsets.
Formal Antitrust Investigation
The information gathered by the European Commission indicates that Broadcom may be implementing a series of exclusive practices on these products, which may include:
(1) Establish exclusive purchasing obligations; (2) give rebates or other benefits on the condition of exclusiveness or minimum purchase requirements; (3) product bundling; (4) abuse of intellectual property related strategies; (5) deliberately reduce the interoperability between Broadcom products and other products.
Concerned about Broadcom's suspicion of such practices, the European Commission decided to launch a formal investigation.
Statement of objection to Interim Measures
At the same time, the European Commission has issued a statement of objection and plans to take some interim measures. It lists the preliminary conclusions of the European Commission's investigation, namely:
(1) When providing on-chip systems (SoC) for TV set-top boxes and modems, Broadcom may dominate the relevant market.
(2) Some of the agreements between Bloom and seven major customers who produce TV set-top boxes and modems contain exclusive clauses that may lead these customers to buy SoC chips, front-end chips and WiFi chipsets exclusively or almost entirely from Bloom.
(3) The provisions of these agreements may affect the competition in these markets and stifle innovation, thereby damaging the interests of consumers.
The preliminary conclusion of the objection statement is that, in such circumstances, Interim Measures against Bloom are indispensable to ensure the effectiveness of any final decision taken by the European Commission in the future.
The European Commission has made the survey of Broadcom a priority.
In fact, it was reported last October that the European Commission had issued a questionnaire, which focused on the set-top-box hardware chips sold by Broadcom. At that time, the European Commission believed that Broadcom might use its market dominance to improperly force customers to buy its semiconductors, thus hurting its competitors.