'Qualcomm fine' shadow looms over TPP talks

"Given the monopoly status of Qualcomm over its technology, the negotiation of the licensing fees is inevitably subject to its bargaining power relative to that of its Chinese licensees. The governments of some developing countries do try to boost the bargaining power of their domestic firms by limiting the maximum royalty rate in licensing contracts via domestic legislation. This type of government policy is unlikely to work for a small country, but China is the largest cell phone market in the world and is thus better able to get concessions from foreign firms."

Qualcomm will also offer licenses to its current 3G and 4G Chinese patents separately from licenses of its other patents, and it will provide patent lists during the negotiation process.

Qualcomm said it plans to continue to grow its investments and expand collaborations in China, including with China's mobile operators, handset and device suppliers, and within the Chinese semiconductor sector.

Chi said the Chinese government may be trying to alter the balance of bargaining power between Qualcomm and its Chinese licensees.