TP-Link under DOJ investigation for alleged predatory pricing practices and national security concerns

The U.S. Department of Justice has reportedly opened an inquiry into TP-Link, the largest consumer router provider in the country, for unfair pricing practices and whether it poses a threat to national security.

TP-Link is known for its affordable home networking products and has reportedly cornered 65% of this market. According to Bloomberg, the DOJ is investigating whether the company achieved this through predatory pricing, wherein it sells goods at a loss to obtain a monopoly. Once it achieves that goal, it would significantly raise its prices to maximize profits at the expense of the consumer.

Aside from the Justice Department’s probe, the U.S. Department of Commerce is also looking into whether TP-Link’s Chinese connections affect the country’s national security, especially with the brand’s popularity among home users. This investigation began in late 2024, especially as the company got tied to Salt Typhoon cyberattacks allegedly backed by Beijing.

TP-Link Systems, based in Irvine, California, is the company behind the routers in the U.S. It was previously owned by TP-LINK Technologies, a Shenzhen, China-based corporation, and only fully established itself as an independent organization in October 2024. The company says it is unaware of any inquiry.

"To date, TP-Link Systems Inc. has not received any inquiry from the Department of Justice regarding these matters. As a U.S.-based company, TP-Link operates with the utmost integrity and transparency, and stands ready to cooperate fully with any government inquiries, should they arise," a spokesman tells Tom's Hardware.

The company claims that its products have been manufactured in its factory in Vietnam since 2018, ensuring that it has control over its supply chain. Still, U.S. officials are concerned about whether the corporate restructuring is enough to insulate it from meddling by the Chinese government, with some experts claiming that it still has a broad presence in mainland China.

"Unlike competitors, TP-Link owns its manufacturing and R&D operations, enabling cost savings and enhanced control over the security of our vertically integrated supply chain," the spokesman told us. "We do not sell products below cost and maintain a policy of transparency in our business practices, ensuring fair pricing for our valued customers."

Investigations like these could take months, if not years, to conclude, and they do not always lead to prosecution. Aside from the criminal proceedings, the DOJ also launched a parallel civil investigation, Bloomberg reported.

The Federal government is apparently doing this to hedge its bets, as Bloomberg says that criminal prosecution of predatory pricing is rather complicated — the government must prove that the company is selling at a loss and that it will recoup its losses by jacking up prices when it has a monopoly on the market. Civil cases have a lower evidentiary requirement, making it easier for the Justice Department to win its case.

If proven guilty, TP-Link could be fined up to a maximum of $100 million. Furthermore, its executives could be slapped with a $1 million penalty, plus possible imprisonment of up to 10 years.