Corning supplies many smartphone and electronic product manufacturers with highly durable glass. Samsung, Apple and many others use the services of this American company, essential in the global supply chain. Only problem: she would abuse her dominant position. The European Commission has launched an investigation.
Brussels has launched a formal investigation into CorningAmerican supplier to many manufacturers to protect the screens of their devices. The general public knows its flagship product, Gorilla Glass, a material designed to be particularly resistant to impacts and scratches. Apple and Corning have also developed the Ceramic Shield, a specific coating for the screens and rear panels of iPhones.
Corning suspected of stifling competition
The European Commission suspects Corning of abuse of dominant position. The company has reportedly signed exclusivity agreements with smartphone manufacturers as well as companies specializing in glass finishing. The regulator will take a close look at exclusive supply obligations: manufacturers would thus be forced to source almost exclusively alkali aluminosilicate glass from Corning, which would limit their freedom of choice from other suppliers.
Corning would also grant discounts to manufacturers, provided that they respect the exclusivity of supply obligations. So-called “English” clauses would require these same manufacturers to inform Corning of competing offers and allow them to choose an alternative offer only if Corning does not offer an equivalent price. Finally, the company would impose exclusive purchasing obligations on companies that process raw glass.
These practices could force competitors out of the market and limit customer choices, thereby increasing prices and inhibiting innovation. “ Breaking a mobile phone screen is a very frustrating and expensive experience », Explains Margrethe Vestager, the European Commissioner for Competition. “ Strong competition in the production of protective glass for these devices is crucial to ensure low prices and high quality glass ».
Corning will now be able to enter into dialogue with the Commission, which specifies that the launch of a formal investigation does not prejudge a conviction.
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Source :
European Commission
