You may be very familiar of the term “Corning Gorilla Glass”, as it is the special sauce for many generations of flagship and mid-range smartphones alike, renowned for its drop and scratch-resistant properties. That popularity may have been a result of foul play however, as European Commission is investigating a potential antitrust case.
Corning Under Antitrust Probe
The European Commission (EC), responsible for anticompetitive legislations like Digital Markets Act and Digital Services Act, is looking into Corning for the possibility of violating its Article 102 TFEU rules, which “prohibits the abuse of a dominant position that may affect trade within the EU and prevent or restrict competition.”
“The Commission has concerns that Corning may have distorted competition by concluding anti-competitive exclusive supply agreements with mobile phone manufacturers and with companies that process raw glass,” the statement noted. Some of the agreements between the glass maker and the smartphone OEMs includes exclusivity sourcing and purchase obligations, rebates, ‘No challenge’ clauses, and ‘English clauses’ that essentially gives it advantage that “may have excluded rival glass producers from large segments of the market.”
In other words, these conditions forces smartphone makers to purchase “all or nearly all” of Corning’s supply (which grants them rebates), and is also obligated to report to the company if other glass maker has more competitive pricing, and only accept such offers if Corning can’t match them. On the other hand, raw glass makers are also forced to purchase its demand, as well as being blocked from challenging its patents under similar agreements.
If found breaching the rules, Corning will be subjected to a fine – though it’s unclear how much that figure will be, or if it’ll be enough of a deterrent (recent history suggests EC has a decent track record of keeping companies in check). However, the company will be given the opportunity to present its case to the Commission to address the concerns.
Source: The Verge
Pokdepinion: I did wonder at some point why it seemed like Corning is the only name in this market, but probably didn’t expect anticompetitive practices to be the reason – if it is proven true, that is.
