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Broadcom is facing a major antitrust crackdown. Gizmodo reports that the Federal Trade Commission has charged Broadcom with “illegally monopolizing” the markets for broadband and TV chips, including WiFi parts. The FTC claimed that Broadcom struck exclusive deals with vendors and service providers that prevented them from buying chips from rival suppliers.
The FTC also accused Broadcom of obtaining “exclusivity and loyalty commitments” for chip supplies, making it difficult for companies to compete on their own merits. The vote was near unanimous, although newly installed Commissioner Lina Khan bowed out.
The Commission’s proposed action would forbid Broadcom from negotiating certain exclusivity and loyalty deals, bar the company from conditioning chip access based on commitments, and ban retaliation against customers who buy from Broadcom’s competitors.
We’ve asked Broadcom for comment, although it previously signalled that it might cooperate on a settlement. It still disagreed with the FTC’s portrayal and claimed that it didn’t break the law.
The chipset giant hasn’t exactly won favor from regulators in recent years. It spent 2017 and 2018 aggressively trying to buy Qualcomm, only to give up after the White House blocked the deal. We wouldn’t expect regulators to make too many concessions as a result, even if a settlement seems likely. Broadcom hasn’t been shy about wanting to dominate the chip business — the FTC will want assurances the company won’t push boundaries in the future.
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