Key Takeaways
- Corning is facing anti-competitive accusations and looking to implement guidelines to address them.
- The commitments include waiving exclusivity clauses, not requiring purchase quotas, and more.
- Failure to follow guidelines could result in fines up to 10% of Corning’s worldwide turnover.
You may not know it by name, but Corning’s Gorilla Glass has been a staple in many mobile products over the past decade, providing the best display protection available. And while the brand has continued to advance its technology year after year, it appears that it may have been pulling some strings in the background in order to prevent the competition from gaining an upper hand.
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With that said, a new investigation by the European Commission dives into details about the brand and its anti-competitive business practices (via Android Authority). In response to this, Corning has come forward with a set of guidelines that could allow it to go back into the European Commission’s good graces, and allow it to operate free from any issues.
Things could change going forward
Of course, the new report from the European Commission outlines some disturbing business practices of Corning, like “exclusive supply agreements with mobile phone manufacturers and with companies that process raw glass.” Because of this, it found that Corning was able to abuse its power to stifle competition, along with increasing prices for its own products.
As stated earlier, Corning has now outlined a game plan that will allow it to address these business practices and to create a better path going forward. Naturally, these commitments will be in effect for some years to come, with the commission stating that they would be “applicable worldwide and would remain in force for a period of nine years.” You can find the commitments below.
- To
waive all exclusive dealing clauses
in all its current agreements with OEMs and finishers for the supply of Alkali-AS Glass, and
not to use such clauses
or others with the same or a similar effect in future agreements worldwide.- When it comes to OEMs’ demand for Alkali-AS Glass intended for devices used in the European Economic Area (‘EEA demand’),
n ot to require OEMs to purchase or cause their supply chain to purchase
any quantity of Alkali-AS Glass from Corning, and
not to offer
OEMs any
price advantages
conditional on such requirements.- When it comes to both (i) OEMs’ non-EEA combined demand for Alkali-AS Glass and transparent glass ceramics (‘Clear Glass Ceramics’), and (ii) OEMs’ total demand for either LAS Glass or Clear Glass Ceramics,
not to require OEMs to purchase or cause their supply chain to purchase
more than 50% of their respective demand from Corning. In addition, Corning will not offer OEMs any price advantages conditional on such requirements.- Not to require finishers to purchase more than 50%
of their
combined demand for NAS Glass, LAS Glass, and Clear Glass Ceramics from Corning, nor to condition price advantages on such purchasing requirements. In addition, Corning will not require finishers in any other way to concentrate more than 50% of this combined demand with Corning. This means that finishers are free to decide the quantity of the different cover materials (NAS Glass, LAS Glass or Clear Glass Ceramics) that they want to purchase from Corning to comply with this overall cap.- When it comes to the enforcement of Corning’s patents related to break-resistant cover glass, to
base any claim only on patent infringement
, and not on breach of contract.
In addition, Corning will
not use any contractual mechanisms
(e.g. penalties)
to reinforce its patent claims.- To
deliver a market communication
to key stakeholders (OEMs and finishers) explaining the content of the above commitments in English and Chinese Mandarin.
Perhaps the most interesting part of all of this is that Corning Gorilla Glass could find its way to other devices. And while lower-end devices might not need this type of protection, it could go a long way in adding more years to a device’s lifespan. Of course, none of this is set in stone yet, and it will need to be agreed upon by all involved.
Once this decision is made, then these terms will be legally binding. And if these commitments are not adhered to, there could be fines “up to 10% of the company’s worldwide turnover.” This is something that you generally don’t want to see, but sometimes, things like this happen, and it’s good to see entities are ensuring that companies and their behavior are being looked into.
