The FTC Thinks You Pay Too Much for Smartphones

Am I missing something here? If Qualcomm charges a 5% royalty up to a maximum of $20, then phones $400 and up all pay the same $20 fee. How is that making them too expensive?

The phones we usually see people call "too expensive" cost a lot more than $400. I don't think $20 is what's making them cost too much.