FTC: The US Federal Trade Commission (FTC) has issued a formal complaint against Broadcom for an alleged monopoly. The company is accused of illegal practices in the markets for semiconductor components used to provide broadband Internet and television services.
The company has become a major supplier of Wi-Fi and Bluetooth chips for companies like Apple. However, the agency’s complaint concerns a segment of communications chips from companies such as AT&T and Verizon — an estimated $2.5 billion market, which represents more than 10 percent of Broadcom’s total revenue.
Chip market monopoly
The FTC says that since 2016, Broadcom has used long-term exclusivity agreements with customers, including service providers and equipment manufacturers (OEMs), to enforce the use of its products.
The inspection agency alleges that the company threatened to retaliate against customers considered “disloyal” by charging higher prices, preventing access to its products. The company also reportedly threatened to cut support for previously purchased components.
Also part of the complaint are Broadcom’s negotiations with TV and broadband service providers.