Broadcom, a semiconductor manufacturer, has been accused of anti-competitive behavior by the Federal Trade Commission (FTC). According to the regulator, the company entered into contracts that infringed on the rights of the other party, equipment makers. CNBC has an article on it.
Broadcom preserved its monopoly through long-term contracts with eleven equipment makers, according to the agency. Partners were not allowed to buy chips from competitors under the terms of the inked agreements. Experts claim that the chipmaker has made similar agreements with major service providers. Broadcom was able to attain a monopolistic position as a provider of three types of processors for TVs and broadband Internet access devices because to this strategy.
Simultaneously, the panel proposes that claims be settled without going to court. Broadcom will no longer be able to enter into contracts that include exclusivity or customer loyalty terms under the proposed deal. In addition, the regulator aims to prevent corporations from retaliating against partners who seek chips from competitors.
“We’re ecstatic to have made progress with the FTC. While we disagree that our activities were illegal and disagree with the commission’s portrayal of our business, we aim to move on from this situation and focus on helping our customers,” Broadcom said in response to the judgment.
The chipmaker and the European Commission reached a similar agreement in October 2020. Under the terms of the agreement, the corporation agrees to keep exclusivity and loyalty clauses out of contracts for the next seven years.