What is the reason for Qualcomm being investigated again?

When the State Administration for Market Regulation of China announced the filing of an investigation into Qualcomm in October 2025, the stock price of this chip giant instantly fell by more than 4% before the US stock market opened, and its market value evaporated by billions of dollars. This is not the first time Qualcomm has been caught in an anti-monopoly vortex: in 2015, it was fined 6.088 billion yuan by China for monopolistic behavior; Now, due to the acquisition of Autotalks, an Israeli train networking chip company, which failed to declare a concentration of operators in accordance with the law, it is facing heavy regulatory pressure again after ten years. From the controversy over the "high tax" in the mobile phone industry to the ambitious layout in the field of smart cars, this investigation is not accidental, but the inevitable result of its long-term wandering on the edge of compliance and abuse of technological advantages, reflecting the deep game between anti-monopoly regulation and technological hegemony in the global technology field.

The direct trigger for the investigation was Qualcomm's deliberate avoidance of regulatory rules in cross-border mergers and acquisitions. The controversial Autotalks acquisition case has exposed Qualcomm's lucky mentality in global expansion. As the only V2X chip supplier in the world that is compatible with DSRC and C-V2X standards, Autotalks' technology is crucial to the intelligent transportation industry chain, and Qualcomm's acquisition could potentially monopolize the core link of vehicle networking communication. Despite a one-year delay in anti-monopoly reviews in Europe and the United States, Qualcomm quietly completed the acquisition in June 2025 without reporting it to Chinese regulatory authorities, directly crossing the "red line" of the Anti Monopoly Law regarding the declaration of business concentration.

This avoidance behavior is not the first time it has occurred. The acquisition of ARM by Qualcomm in 2024 has been reviewed by the US FTC, and the operation against Autotalks highlights its disregard for emerging market regulation. According to Article 58 of China's Anti Monopoly Law, those who fail to declare concentration and have the effect of excluding competition may be fined up to 10% of the previous year's sales revenue. Based on Qualcomm's global revenue of over $40 billion in 2024, if the investigation finds it illegal, it may face billions of yuan in fines and even be required to split its Autotalks business. The intervention of regulatory authorities is essentially a clear reaffirmation that 'no matter how large the enterprise is, it must abide by market rules'.

The deeper reason is that Qualcomm's "patent hegemony" business model, which has lasted for more than ten years, has never truly been reformed. Qualcomm's core profit model is the dual binding of "chips+patents", and its patent licensing business contributes 87% of pre tax profits with 30% of revenue, which has been criticized by the industry as the "Qualcomm tax". The most controversial is its "whole machine price billing" rule, which requires manufacturers to pay patent fees at 5% -6% of the wholesale net price of the whole machine, rather than just the value of the baseband chip. A smartphone priced at 2000 yuan only requires a patent fee of 100-120 yuan, far exceeding the cost of chip hardware. The CEO of Qualcomm once admitted that if a BMW car is equipped with its communication chip, theoretically it would need to pay a patent fee of 5% of the total vehicle price, which shows the absurdity of this logic.

In the international market, this exclusivity has been repeatedly cracked down by regulations: in 2009, South Korea found it to be charging discriminatory high licensing fees to non Qualcomm chip manufacturers and imposed a fine of $208 million; In the same year, Japan demanded that it correct the "free reverse license" clause. In the Chinese market, the harm of this strategy is even more significant. Xiaomi and other mobile phone manufacturers heavily rely on Qualcomm chips. After Xiaomi's failed attempt to use Nvidia chips in 2013, flagship models still rely on the Snapdragon platform. Even if they develop their own chips, they still need to sign a 15 year cooperation agreement. This technological dependence has severely compressed the profit margins of domestic manufacturers and hindered the innovation vitality of the industry.

This survey also echoes the global trend of anti-monopoly. From the EU's Digital Markets Act prohibiting "gatekeeper" companies from self favoring, to the US FTC strengthening merger and acquisition reviews of tech giants, countries are curbing the erosion of market fairness by technology monopolies. The actions of Chinese regulatory authorities are not only to protect the compliance of domestic enterprises, but also to maintain the order of the global industrial chain - as the legal community has said, whether domestic or foreign enterprises, as long as their transactions may affect competition in the Chinese market, they must comply with Chinese laws.

Behind Qualcomm's further investigation is a fierce collision between technological monopoly and market fairness, a direct confrontation between the profit seeking nature of the enterprise and regulatory bottom line. If the investigation ultimately determines that it is illegal, not only will it face huge fines, but it may also be forced to restructure its business model. For the entire industry, this is undoubtedly an important opportunity to break the technological monopoly and stimulate innovation vitality. As the shadow of the "high pass tax" gradually dissipates, domestic chip companies will have a fairer competitive environment, and the global technology industry will also develop towards a more open and balanced direction. The significance of this investigation has already surpassed the individual case itself and become an important footnote to the maturity of the global technology governance system.