Qualcomm (QCOM) May Need to Accept Lower Licensing Fees to Remain Relevant in China
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Qualcomm (Nasdaq: QCOM) is on watch Tuesday following news that the world's largest mobile handset market is looking to cut down on certain licensing fees.
According to Bloomberg, China is aiming to pay Qualcomm lower royalty payments for technology utilized by domestic smartphone manufacturers.
China’s National Development and Reform Commission and Qualcomm are still in negotiations with the anti-monopoly probe now spanning 13 months. Qualcomm's sales in China have been hampered by the talks as mobile phone makers look to avoid paying licensing fees for the company's technology.
Qualcomm is not alone in being targeted by regulators in China; both Microsoft (Nasdaq: MSFT) and Symantec (Nasdaq: SYMC) are two additional technology companies being investigated by the NDRC.
Qualcomm said it would take on higher fines to avoid changing its licensing scheme, though that offer was previously rejected by Chinese authorities.
Shares of Qualcomm are lower early Tuesday.
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