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Turns out Qualcomm’s Chinese buddies oppose Broadcom’s takeover bid

Tense relations between United States and China. Concept of conflict and stress

Qualcomm seems keen to enlist the services of its new set of Chinese allies in some of its many other fights.

A report in the FT (sub required) claims “Qualcomm has won the backing of a group of Chinese smartphone manufacturers in its fight to fend off a $130bn hostile bid from rival Broadcom.” Those vendors are: Xiaomi, Oppo and Vivo, and by staggering coincidence the three of them have just pledged their undying loyalty to Qualcomm as customers of its 5G chips.

“When we first heard of [the Broadcom bid], our biggest concern was, if it happened, would there still be era-defining communications products?” said Lin Bin, President of Xiaomi, and the FT didn’t seem to get any other quotes from smartphone vendors.

As well as the ongoing Broadcom thing Qualcomm still hasn’t had its acquisition of NXP approved, with the Chinese being the last set of regulators to make up their mind on the matter. With that in mind Qualcomm President Cristiano Amon has been buttering up the Chinese government while he’s over there, and apparently reckons all the friends it has made in China will give it brownie points with the regulators.

“The remarks by Qualcomm’s partners will certainly influence any future decision by Chinese regulators over the Broadcom bid,” said Cui Kai, an analyst at IDC, in the FT piece. “China is trying to upgrade its manufacturing. These manufacturers highly rely on Qualcomm, and that will be an important consideration for the regulators.”

Amon concluded that, since US companies like Apple are giving it such a hard time, then China suddenly looks like a more rewarding place to hang out, even going so far as to praise China as a good place to do business with intellectual property. This would appear to put Qualcomm squarely at odds with the US government and may yet end up being a case of: out of the frying pan, into the fire.


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