Qualcomm must license modem tech to rivals like Intel, court rules
Denying a motion to delay court proceedings while settlement talks are ongoing, U.S. District Judge Lucy Koh on Tuesday issued a preliminary ruling against Qualcomm in the Federal Trade Commission's antitrust lawsuit.
Qualcomm must license some of the patents it holds for smartphone modems to firms like Intel, Koh ruled according to Reuters. The company is accused of forcing companies like Apple to buy its wireless chips in exchange for better patent royalty rates.
In fact Apple was in an exclusive modem supply arrangement with Qualcomm for several years, but started mixing in Intel chips with 2016's iPhone 7, and is now Intel-only with the iPhone XS and XR.
The FTC case is related to an Apple action dating back to January 2017. Apple filed a $1 billion lawsuit shortly thereafter, marking the beginning of a global legal war, compounded by actions from various government bodies and Qualcomm accusations that Apple handed trade secrets to Intel to improve chip performance.
In August, Qualcomm reached a settlement with Taiwanese antitrust regulators, avoiding a $773 million fine in exchange for paying $93 million and investing $700 million in the country over the course of five years. It has also made deals with parties like Samsung, which like Apple is a major phone customer.
Qualcomm must license some of the patents it holds for smartphone modems to firms like Intel, Koh ruled according to Reuters. The company is accused of forcing companies like Apple to buy its wireless chips in exchange for better patent royalty rates.
In fact Apple was in an exclusive modem supply arrangement with Qualcomm for several years, but started mixing in Intel chips with 2016's iPhone 7, and is now Intel-only with the iPhone XS and XR.
The FTC case is related to an Apple action dating back to January 2017. Apple filed a $1 billion lawsuit shortly thereafter, marking the beginning of a global legal war, compounded by actions from various government bodies and Qualcomm accusations that Apple handed trade secrets to Intel to improve chip performance.
In August, Qualcomm reached a settlement with Taiwanese antitrust regulators, avoiding a $773 million fine in exchange for paying $93 million and investing $700 million in the country over the course of five years. It has also made deals with parties like Samsung, which like Apple is a major phone customer.
Comments
Ugh, this is so short sighted. Nation states should force QCOM to license their SEP at FRAND rates based on the cost of the modem. Make it as cheap as possible. This makes the most economic sense for a place like Taiwan as everyone and their couch surfing amateur OEM will be able to put LTE modems into their devices. This means more business for TSMC, more business for OEMs, more business for carriers, so on and so forth. Commoditizing modems enables more. Instead, they go for a pittance and let QCOM use their SEP rate practices go on.
Dollars to donuts, Apple will have their own Apple design cellular modem hardware, on a separate chip or right into the SoC die. Driving licensing rates for SEP to costs of the components is a big deal for them.
Maybe both.
Here is one real-world example:
One of my line with telco ST is on legacy plan (early/first 4G plan back then) and have not re-contract over several years. The telco simply locks this line to the plan (along with the profile in the backend) so even now with iPhone X and XS, this line does not gain any higher speed/throughput despite the LTE modem in them are capable of. In short, the telco has locked this line to legacy LTE profile and unless this line renews to newer plans under contract again, it will not gain any higher speed/throughput. Hence, even if Qualcomm's modem is marginally better in performance than Intel's modem, it makes no difference to me (or whoever in my household using this line). I am not alone on this scenario. At least I know a few of my personal friends are the same since legacy plans have higher data volume (12GB or 25GB per month) than newer plans which significantly reduced to 2-3GB per month for the same price (forcing us to sign up add-ons which indirectly is telco squeezing us to pay more and more for data volume consumption). To have the same 12GB or 25GB, the cost of new plans+add-ons is easily 3-4 times more expensive.
To summarize, I don't really care if Qualcomm's modem is indeed better in performance. In iPhone X and XS, the Intel's modem serves its purpose good enough (easily hitting 50-60Mbps which is more than enough for most smartphone uses, even watching video streams from Netflix or local provider's Toggle).
As for modems, Qualcomm and Intel modems drop service at the same spots for me thanks to AT&T.
But I’m sure you know that already.
Of course, more factors come into play, as the modem is only part of the story but in January this year, competitors almost doubled the iPhone X download speeds - for example, in San Francisco.
There are parts of the world with very good backbone networks and if you happen to live in one of those areas, the difference will be very noticeable. With the new iPhones and the gigabit modems in them, the difference has been reduced but will still be noticeable when compared to the Cat 21 modems in competing phones (especially as more backbone networks get upgraded).
Re: modem speeds, I've read stories here on AI and other places that talk about modem speeds and did tests showing the QC modems were faster and appeared to have better amplifiers to pull in weak signal, but because of the inherent variables in these systems. Ultimately, I think variables in antennas and signal play a bigger roll and overshadow the differences between the modems.
I mean can you imagine walking into a shop or supermarket and being confronted by someone requesting your financials and annual salary so they could work out how much to charge you?! 😂
Apple can lag in implementing future cellular standards for years now. 50 Kbit/s to 500 Kbit/s was huge. It made smartphones possible. 500 Kbit/s to 5 Mbit/s was huge as it made smartphones a mega platform with entire app ecosystems. 5 Mbit/s to 50 Mbit/s made things pleasant to use. Hardly any waiting anymore. 50 Mbit/s to 500 Mbit/s? Not sure what that is buying outside of precious few customers who are moving GB of data from network servers to their phones or by proxy to their computers.
Helps Ms the cell towers, and will help customers on those cell towers, but this is a multi year waiting game those cell towers to be upgraded.