Apple, Qualcomm reach modem licensing deal to end 'no license, no chips' trial

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  • Reply 41 of 127
    chasmchasm Posts: 3,239member
    wood1208 said:
    Intel 5G chip will be under pressure. We still don't know details of settlement including money aspect.
    This will give Apple multiyear licensing agreement for Qualcomm chips and IP to build own 5G chip in future.
    I would be very surprised if Qualcomm won more than 50 percent of Apple's 5G business after this. I think there's a reason this agreement is for such a relatively short time ... it's the time Apple needs to completely rid itself of any need for Qualcomm's services.
    JFC_PAGeorgeBMac
  • Reply 42 of 127
    sacto joesacto joe Posts: 895member
    gatorguy said:
    carnegie said:
    gatorguy said:
    sacto joe said:
    My guess is, Qualcomm finally put an offer on the table that dropped the "percentage of phone price" as the determinant of the cost of the chip.  But perhaps the price was higher than Apple would have insisted on had they won at trial, but it was lower than what they had been paying by enough to just end it.

    The details will be interesting though as I believe an in-house chip by Apple was coming within the next year or two.  Does this put that initiative on hold for six years, or does Apple retain the right to put its own chip in a certain percentage of iPhones just like they put Intel modems in a certain amount of them before?
    I think this is closer to the mark than "Qualcomm won, Apple lost". And if it's right, then Apple came out ahead in the medium and long term, while Qualcomm gets to live a while longer. 

    But I'll hold off on any more opinions for now. My go-to source is http://www.fosspatents.com and he hasn't weighed in on this yet.
    He'll be shocked as he's been convinced from the get-go that Apple intended to carry this thru to the end.  
    If that's what he expected, I'm surprised. I check in on what he's saying sometimes, usually when I can't find a filing or when I'm interested in something that I won't be able to find information on myself (e.g., with regard to the judicial proceedings in Germany).

    I thought it was likely that Qualcomm and Apple would eventually settle their disputes, and that it would be more likely that they did once this case and the FTC case were decided. I'm surprised that (if) he thought otherwise. Or did he just think that Apple would see the case which just went to trial (i.e. the one heard by Judge Curiel) through to the end before agreeing to settle?
    The latter. 
    Pure conjecture.
  • Reply 43 of 127
    gatorguygatorguy Posts: 24,105member
    sacto joe said:
    gatorguy said:
    carnegie said:
    gatorguy said:
    sacto joe said:
    My guess is, Qualcomm finally put an offer on the table that dropped the "percentage of phone price" as the determinant of the cost of the chip.  But perhaps the price was higher than Apple would have insisted on had they won at trial, but it was lower than what they had been paying by enough to just end it.

    The details will be interesting though as I believe an in-house chip by Apple was coming within the next year or two.  Does this put that initiative on hold for six years, or does Apple retain the right to put its own chip in a certain percentage of iPhones just like they put Intel modems in a certain amount of them before?
    I think this is closer to the mark than "Qualcomm won, Apple lost". And if it's right, then Apple came out ahead in the medium and long term, while Qualcomm gets to live a while longer. 

    But I'll hold off on any more opinions for now. My go-to source is http://www.fosspatents.com and he hasn't weighed in on this yet.
    He'll be shocked as he's been convinced from the get-go that Apple intended to carry this thru to the end.  
    If that's what he expected, I'm surprised. I check in on what he's saying sometimes, usually when I can't find a filing or when I'm interested in something that I won't be able to find information on myself (e.g., with regard to the judicial proceedings in Germany).

    I thought it was likely that Qualcomm and Apple would eventually settle their disputes, and that it would be more likely that they did once this case and the FTC case were decided. I'm surprised that (if) he thought otherwise. Or did he just think that Apple would see the case which just went to trial (i.e. the one heard by Judge Curiel) through to the end before agreeing to settle?
    The latter. 
    Pure conjecture.
    Well of course, as are your comments. So?
    MplsPradarthekatchemenginelijahgmuthuk_vanalingamCarnage
  • Reply 44 of 127
    gatorguygatorguy Posts: 24,105member
    sacto joe said:
    gatorguy said:
    sacto joe said:
    My guess is, Qualcomm finally put an offer on the table that dropped the "percentage of phone price" as the determinant of the cost of the chip.  But perhaps the price was higher than Apple would have insisted on had they won at trial, but it was lower than what they had been paying by enough to just end it.

    The details will be interesting though as I believe an in-house chip by Apple was coming within the next year or two.  Does this put that initiative on hold for six years, or does Apple retain the right to put its own chip in a certain percentage of iPhones just like they put Intel modems in a certain amount of them before?
    I think this is closer to the mark than "Qualcomm won, Apple lost". And if it's right, then Apple came out ahead in the medium and long term, while Qualcomm gets to live a while longer. 

    But I'll hold off on any more opinions for now. My go-to source is http://www.fosspatents.com and he hasn't weighed in on this yet.
    He'll be shocked as he's been convinced from the get-go that Apple intended to carry this thru to the end.  
    Why don't we just wait for his take rather than making assumptions? Unless you've got some kind of dog in this hunt....
    I thought you'd been reading his articles. 

    Mueller: "It (QC) will keep trying, but realistically it won't be able to force Apple into a settlement before some key antitrust, contract and patent exhaustion questions are resolved in the United States (in the lawsuit Apple filed)"
    edited April 2019 muthuk_vanalingam
  • Reply 45 of 127
    It wouldn't surprise me they hammered out an agreement where Apple can actually drop their iPhone prices a little yet keep the margin levels the same.  Perhaps the cost of adding 4G (and in the future 5G) to iPads comes down a little as well.
  • Reply 46 of 127
    avon b7avon b7 Posts: 7,539member
    dt17 said:
    avon b7 said:
    No doubt those who spouted so much vitriol against Qualcomm have mixed feelings now. QC was evil but now a different viewpoint will probably unfold.

    If the X55 ends up in the 2019 refresh, no doubt all the talk about 5G being unnecessary on the iPhone this year will be forgotten.

    I wonder how much of a factor the 5G modem really was in ending this issue (and how much Apple paid in the end).


    And if the X55 doesn’t end up in 2019 refresh? Will you buy each of us here an iPhone?
    No. LOL

    The 'if' part is there for that reason. The point being that it will be interesting to see what ends up in the 2019 refresh. If it is the X55 it would lend weight to the idea that Apple was in need of a 5G offering this year.
    muthuk_vanalingam
  • Reply 47 of 127
    asdasdasdasd Posts: 5,686member
    tht said:
    gatorguy said:
    wood1208 said:
    Intel 5G chip will be under pressure. We still don't know details of settlement including money aspect.
    This will give Apple multiyear licensing agreement for Qualcomm chips and IP to build own 5G chip in future.
    Apparently a 6-year royalty license to the IP, tho no mention of a license to manufacture. I would guess that Apple is forgoing further development of their own chip for the near future, at least in any shipping device, since they've agreed to purchase QC chips for multiple years as part of this settlement. 
    I wouldn’t bet on either of these scenarios.

    OEMs are required to pay QC regardless if they use QC LTE modems or not. QC is deeply embedded in the patent pool. The imbroglio was over how much those patents are worth. Apple wanted to pay a lot less. QC wanted them to pay a lot more. They were going to court to have judge and jury figure out how much should be paid.

    In the future, Apple will continue to use Intel modems, possibly use QC modems, and will use their own custom modems if satisfactory. This settlement just means they have come to agreement on how much should be paid for these scenarios.
    It’s been reported as a lot more than that. A 6 year agreement. 
    muthuk_vanalingam
  • Reply 48 of 127
    carnegiecarnegie Posts: 1,077member
    gatorguy said:
    carnegie said:
    gatorguy said:
    sacto joe said:
    My guess is, Qualcomm finally put an offer on the table that dropped the "percentage of phone price" as the determinant of the cost of the chip.  But perhaps the price was higher than Apple would have insisted on had they won at trial, but it was lower than what they had been paying by enough to just end it.

    The details will be interesting though as I believe an in-house chip by Apple was coming within the next year or two.  Does this put that initiative on hold for six years, or does Apple retain the right to put its own chip in a certain percentage of iPhones just like they put Intel modems in a certain amount of them before?
    I think this is closer to the mark than "Qualcomm won, Apple lost". And if it's right, then Apple came out ahead in the medium and long term, while Qualcomm gets to live a while longer. 

    But I'll hold off on any more opinions for now. My go-to source is http://www.fosspatents.com and he hasn't weighed in on this yet.
    He'll be shocked as he's been convinced from the get-go that Apple intended to carry this thru to the end.  
    If that's what he expected, I'm surprised. I check in on what he's saying sometimes, usually when I can't find a filing or when I'm interested in something that I won't be able to find information on myself (e.g., with regard to the judicial proceedings in Germany).

    I thought it was likely that Qualcomm and Apple would eventually settle their disputes, and that it would be more likely that they did once this case and the FTC case were decided. I'm surprised that (if) he thought otherwise. Or did he just think that Apple would see the case which just went to trial (i.e. the one heard by Judge Curiel) through to the end before agreeing to settle?
    The latter. 
    That makes sense I guess. If you'd made me bet one way or the other, I suspect I'd have laid my money on Apple seeing this trial through before finalizing an agreement with Qualcomm. But it doesn't shock me that they settled (effectively) before the trial.

    With all of the pre-trial motions and filings, Qualcomm was generally trying to narrow the scope of this trial while Apple was trying to expand it. Qualcomm wanted it to be just about a contract dispute. What were the terms of our contracts? Were they breached? Etc. Apple wanted a lot more things to be considered and decided - issues relating to invalidity, exhaustion, anti-trust behavior, proper FRAND terms. Qualcomm was successful in some regards in getting some considerations put aside, but I'd say that on the whole Apple won in getting the trial to be about more than just contract interpretation and enforcement. Stepping back and looking at the broader picture, maybe that created just enough leverage and made a pre-trial settlement more likely.
  • Reply 49 of 127
    1st1st Posts: 443member
    no holywood drama for lawyers?  those are make or break career showcase for them in the open.  Hopefully, FTC suit still has second act to watch.  Pressure on Intel got get some widgets come out to steal the show.  (on the other hand, at least 5G still in our hands to lead... sorry, correction,  to catch up).  Cloud storage subscription increase forecasted - good for apple, stream successfully ;-).  
  • Reply 50 of 127
    MplsPMplsP Posts: 3,905member
    avon b7 said:
    No doubt those who spouted so much vitriol against Qualcomm have mixed feelings now. QC was evil but now a different viewpoint will probably unfold.

    If the X55 ends up in the 2019 refresh, no doubt all the talk about 5G being unnecessary on the iPhone this year will be forgotten.

    I wonder how much of a factor the 5G modem really was in ending this issue (and how much Apple paid in the end).


    There were/are many people like me who readily admit that QC makes good chips but has shady, if not downright criminal business practices. I still feel the same way, but as a practical matter, there are precious few options in the market for 5G chips. intel has been making strides, but they are still behind QC.

    As far as whether 5G is necessary - my opinion hasn't changed. It will not be necessary in a smart phone for at least 2-3 years, likely longer. If putting an unnecessary capability in the phone helps apple avoid the appearance of being behind then fine, as long as it doesn't compromise battery life or other performance that actually does matter. I suspect 5G was a factor, though; it was really the only bargaining chip QC had.
    GG1
  • Reply 51 of 127
    DAalsethDAalseth Posts: 2,783member
    Well, if that chicken analogy was the best they could come up with I'm not surprised Apple settled. 

    Seriously though I suspect that both companies knew that if it went to trial it would drag out and both would lose in the long run. Apple needed Qualcomm's modems and patent access, Qualcomm needed Apple's market power. The payment was likely what Apple owed them from before. The new deal is likely much more to Apple's liking for price, and to Qualcomm's for length. 
    stompyradarthekatmuthuk_vanalingam
  • Reply 52 of 127
    flydogflydog Posts: 1,121member
    Qualcomm Blinked...
    In case you missed it, Qualcomm received cash, a six-year license agreement, and if that wasn't enough its market cap increased by about $17 billion after the settlement.

    More like Qualcomm won the powerball 100 times over. 




    mazda 3schemenginmuthuk_vanalingamCarnage
  • Reply 53 of 127
    carnegiecarnegie Posts: 1,077member
    It wouldn't surprise me they hammered out an agreement where Apple can actually drop their iPhone prices a little yet keep the margin levels the same.  Perhaps the cost of adding 4G (and in the future 5G) to iPads comes down a little as well.
    I wouldn't expect this settlement (or whatever changes it represents in what Apple effectively pays Qualcomm for licensing) to affect iPhone prices. In theory it might affect them a few dollars, but the increments which Apple would be willing to use are likely larger than the per-device effect of this settlement. In other words, Apple might be deciding between $799 and $749 for a given iphone model. It likely wouldn't be deciding between $799 and $789. So a few dollars change in per-device costs isn't likely to cause a change in the eventual retail price. That said, it's possible that for some model the call between, e.g., $799 and $749 is really close, in which case a few dollars more or less in per-device costs could push the decision one way or the other.
    muthuk_vanalingam
  • Reply 54 of 127
    flydogflydog Posts: 1,121member

    gatorguy said:
    sacto joe said:
    Wow! Basically, Qualcomm blinked. This is going to be a positive for AAPL's price....although maybe the word had leaked out some time ago, and that would explain the big push upward for AAPL lately. Was this the worst kept secret in the world?

    Inquiring minds want to know…

    Early stock response has been very muted for Apple , but QC is up significantly. 
    The stock movements reflect that Apple had nothing to lose other than paying a judgment, while Qualcomm's entire business was floundering the longer this dragged on. 
    MplsPradarthekat
  • Reply 55 of 127
    flydogflydog Posts: 1,121member

    gatorguy said:
    wood1208 said:
    Intel 5G chip will be under pressure. We still don't know details of settlement including money aspect.
    This will give Apple multiyear licensing agreement for Qualcomm chips and IP to build own 5G chip in future.
    Apparently a 6-year royalty license to the IP, tho no mention of a license to manufacture. I would guess that Apple is forgoing further development of their own chip for the near future, at least in any shipping device, since they've agreed to purchase QC chips for multiple years as part of this settlement
    Didn't see that anywhere in the article.  Pure speculation on your part. 
    radarthekat
  • Reply 56 of 127
    gatorguy said:
    sacto joe said:
    My guess is, Qualcomm finally put an offer on the table that dropped the "percentage of phone price" as the determinant of the cost of the chip.  But perhaps the price was higher than Apple would have insisted on had they won at trial, but it was lower than what they had been paying by enough to just end it.

    The details will be interesting though as I believe an in-house chip by Apple was coming within the next year or two.  Does this put that initiative on hold for six years, or does Apple retain the right to put its own chip in a certain percentage of iPhones just like they put Intel modems in a certain amount of them before?
    I think this is closer to the mark than "Qualcomm won, Apple lost". And if it's right, then Apple came out ahead in the medium and long term, while Qualcomm gets to live a while longer. 

    But I'll hold off on any more opinions for now. My go-to source is http://www.fosspatents.com and he hasn't weighed in on this yet.
    He'll be shocked as he's been convinced from the get-go that Apple intended to carry this thru to the end.  
    He doesn't sound that shocked:

  • Reply 57 of 127
    spice-boyspice-boy Posts: 1,450member
    Great, taxpayers won.
    color
  • Reply 58 of 127
    MplsPMplsP Posts: 3,905member
    gatorguy said:
    sacto joe said:
    My guess is, Qualcomm finally put an offer on the table that dropped the "percentage of phone price" as the determinant of the cost of the chip.  But perhaps the price was higher than Apple would have insisted on had they won at trial, but it was lower than what they had been paying by enough to just end it.

    The details will be interesting though as I believe an in-house chip by Apple was coming within the next year or two.  Does this put that initiative on hold for six years, or does Apple retain the right to put its own chip in a certain percentage of iPhones just like they put Intel modems in a certain amount of them before?
    I think this is closer to the mark than "Qualcomm won, Apple lost". And if it's right, then Apple came out ahead in the medium and long term, while Qualcomm gets to live a while longer. 

    But I'll hold off on any more opinions for now. My go-to source is http://www.fosspatents.com and he hasn't weighed in on this yet.
    He'll be shocked as he's been convinced from the get-go that Apple intended to carry this thru to the end.  
    They may have, but they are also a business, and if they came to a reasonable agreement with QC that avoided the cost and potential risk of a trial they likely made a business decision. Beyond that, any decision would have been appealed by the losing side and the whole ordeal would have dragged out for years. Neither side really wanted that.

    Personally, I was really hoping to see QC lose in court big time, but I'll have to look for entertainment other places, I guess.
  • Reply 59 of 127
    MplsPMplsP Posts: 3,905member
    DAalseth said:
    Well, if that chicken analogy was the best they could come up with I'm not surprised Apple settled. 

    Seriously though I suspect that both companies knew that if it went to trial it would drag out and both would lose in the long run. Apple needed Qualcomm's modems and patent access, Qualcomm needed Apple's market power. The payment was likely what Apple owed them from before. The new deal is likely much more to Apple's liking for price, and to Qualcomm's for length. 
    I'm sure it spoke to the jury - that's what counts.

    You're right about the trial dragging out, though. When was the last time anything like this got settled in less than 5 years if the companies don't settle outside of court?
  • Reply 60 of 127
    gatorguygatorguy Posts: 24,105member
    flydog said:

    gatorguy said:
    wood1208 said:
    Intel 5G chip will be under pressure. We still don't know details of settlement including money aspect.
    This will give Apple multiyear licensing agreement for Qualcomm chips and IP to build own 5G chip in future.
    Apparently a 6-year royalty license to the IP, tho no mention of a license to manufacture. I would guess that Apple is forgoing further development of their own chip for the near future, at least in any shipping device, since they've agreed to purchase QC chips for multiple years as part of this settlement
    Didn't see that anywhere in the article.  Pure speculation on your part. 
    What was the giveaway? Was it me writing "I would guess..."?

    LOL!
    edited April 2019 muthuk_vanalingam
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