# European Commission Probes Corning for Alleged Antitrust Infractions
The European Commission (EC) has initiated an investigation into Corning, a glass manufacturing giant based in the US, concerning potential antitrust violations linked to its leading product, Gorilla Glass. The EC is examining claims that Corning’s alleged restrictive business strategies, including exclusivity agreements, pricing tactics, and patent demands, may have hindered competition and innovation within the mobile phone screen sector.
## Allegations Made Against Corning
Corning’s Gorilla Glass is a prominent brand in the mobile device market, renowned for its toughness and resistance to shattering. However, findings from the EC’s inquiry suggest that Corning’s market position may not solely be attributed to the superior quality of its offerings. The EC alleges that Corning has engaged in practices that constrain competition by binding device manufacturers and finishers (entities that convert raw glass into final products) into exclusive or predominantly exclusive contracts.
### Principal Allegations:
1. **Exclusive Procurement Contracts**: The EC asserts that Corning has provided rebates and additional incentives to device manufacturers who commit to sourcing “all or nearly all” of their glass requirements from Corning. This could potentially obstruct rival glass manufacturers from establishing a presence in the market.
2. **Disclosure of Competing Offers**: Corning reportedly mandated device producers to disclose any competitive proposals from alternative glass manufacturers. This could grant Corning an undue advantage by permitting it to undercut competitors before they could secure contracts.
3. **Coercion of Finishers**: The EC further charges Corning with pressuring finishers to refrain from collaborating with competing glass suppliers and dissuading them from contesting Corning’s patents. This could restrict competition and innovation within the sector even further.
### Possible Market Consequences
The EC’s concerns revolve around the notion that Corning’s practices might have excluded competing glass manufacturers from significant portions of the market. This exclusion could lead to fewer choices for consumers, elevated prices, and diminished innovation in the mobile phone sector. The Commission expressed that such arrangements “may have barred rival glass producers from extensive segments of the market, resulting in decreased consumer options, increased costs, and stifled innovation to the detriment of worldwide consumers.”
Should the allegations be substantiated, Corning may face substantial penalties and be compelled to revise its business practices in Europe.
## Gorilla Glass: A Dominant Player
Gorilla Glass has become a synonym for resilient smartphone displays, akin to how brands like Xerox and Kleenex are associated with their products. Corning has persistently promoted its glass as being tougher and more resilient than that of its competitors, with each iteration of Gorilla Glass showcasing enhanced features.
For instance:
– **Gorilla Glass 4** was advertised as being “up to two times stronger” than any competing alternative.
– **Gorilla Glass 5** claimed the ability to withstand a 1.6-meter fall 80% of the time.
– **Gorilla Glass 6** presented improved resistance to cumulative damage from multiple drops.
These advancements have enabled Corning to uphold its role as the primary supplier for numerous smartphone manufacturers, including leading names like Apple.
## Corning and Apple: A Close Ties
The strong bond between Corning and Apple has been extensively documented. Apple has made substantial investments in Corning, including a $45 million investment in 2021 aimed at enhancing its US manufacturing capabilities. Corning’s glass products are essential to Apple’s devices, exemplified by the **Ceramic Shield** utilized on the iPhone 12, heralded for delivering four times better drop performance than earlier models.
Originally, the first iPhone was set to feature a plastic screen, but Steve Jobs famously insisted on the switch to Gorilla Glass shortly before the device’s launch. Since then, Corning has served as a vital supplier for Apple, and both companies have continued to collaborate on pioneering advancements in glass technology.
## What Lies Ahead?
The EC’s investigation is in its preliminary phases, and it is uncertain if Corning will incur any penalties or be required to alter its business practices. If the EC determines that Corning has breached antitrust regulations, the company could face substantial fines and be mandated to diversify its supply chain to encourage more competition.
Corning has yet to respond to the allegations, but the company is anticipated to defend its business operations by asserting that its success stems from the quality of its products rather than engaging in unfair competition.
The outcome of this investigation may significantly affect the mobile phone industry, especially in Europe, where antitrust authorities have taken a firm stance against monopolistic behaviors in recent years.
## Summary
The European Commission’s probe into Corning draws attention to the increasing scrutiny directed at large corporations that monopolize specific markets. While Corning’s Gorilla Glass has achieved widespread recognition in the mobile phone sector, the EC’s claims indicate that its market supremacy may not be entirely based on the quality of its offerings. Should the investigation conclude that Corning has participated in anti-competitive practices, it could lead to substantial ramifications for the company.
