Judge rules Qualcomm violated federal antitrust laws, orders remedial action

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  • Reply 21 of 40
    maestro64maestro64 Posts: 4,599member
    maestro64 said:
    Yep, no surprise here and most likely the reason QCOM and Apple settle out of court. With this ruling QOM would not have been in a good position with negotiating deal with Apple.
    Not following the logic here. If this ruling had come first, I feel like Apple would have either gone to trial with new precedent set, or gotten a better deal (if reports are to be believed that the deal was not great for Apple). Still seems more likely to me that Apple, faced with Intel's inability to deliver timely modems (that would be licensed from Qualcomm anyway) and a 5-year ramp up for its own team to work around patents in its internally developed modems, was facing years without 5G in the iPhone which would potentially be devastating as early as Fall of 2020. If Apple had lost its trial, the financial loss could be way worse than if it settled when there were still risks for Qualcomm. There were no options, in other words, but for Apple to give its lunch to the bully.
    If you see what Apple got from QCOM which we have limited information, we know Apple paid something for future licensing, QCOM obviously drove the settlement with Apple. Apple does not have too much of history of settling out of court unless they feel it is going to be a far better deal for them. They also fight on principle, which you generally do not see much these days, its usually all about the money and no wants to set any court precedence or let a judge decide. They rather have a close door agreement that no one knows about.

    This loss for QCOM means Intel may have gotten what they needed from QCOM at a reasonable cost which would have gotten Apple what they needed from Intel. QCOM could not afford this especially with rumors of Apple making their own modem chips which most likely will end up in the SOC. The QCOM deal with Apple killed the relationship with Intel which means that Intel does not have a big customer for the modem chip thus the reason we now hearing Intel may shut it all down.

    If you think Apple lost in the deal think again. The decision today is going to cost QCOM a lot of money, at least now they have long term deal with Apple and Apple got what they need directly from the main source without having to work with third parties. There is a lot more going on here than what is obvious and public.
    edited May 22 ronnchasm
  • Reply 22 of 40
    ronnronn Posts: 330member
    ronn said:
    gatorguy said:
    red oak said:
    wanderso said:
    Seems that Apple might have wanted to wait a few more weeks to settle. 
    It will take many months to work through the appeals process.  And the outcome is not guaranteed.  Apple needed the chips now 

    But as long as the FTC wins at the end, it will not matter.   The contract will get torn up 
    I don't see that happening. 
    Doesn't the ruling mandate that:

    "...Qualcomm must negotiate or renegotiate license terms with customers in good faith under conditions free from the threat of lack of access to or discriminatory provision of modem chip supply or associated technical support or access to software."

    Which could give Apple a leg up on redoing the contract.
    Negotiate - From a go-forward perspective.  Renegotiate - if terms were negotiated under bad faith and threats.  There's nothing available that says Apple and QC negotiated their agreement under bad faith or threats.  In fact, there's a fair contingent of AI forum members who insist it was Apple negotiating from a position of strength so the conditions for renegotiation weren't really present.  We don't know so we can't assume.  Regardless, that excerpt you quoted does not mandate renegotiation.
    Everything in Koh's ruling points to Qualcomm operating under bad faith. Hell, she stopped just short of calling Q's witnesses/executive perjurers. They lost on nearly every count and she mandated government oversight for a period of seven years. The parties are holding the contract close to their vests, so no one can say with definitive proof who won. But given the previous worldwide rulings against Qualcomm, this outcome and the upcoming German trials, Qualcomm will be in a world of hurt.
    chasmnetmage
  • Reply 23 of 40
    ronn said:
    ronn said:
    gatorguy said:
    red oak said:
    wanderso said:
    Seems that Apple might have wanted to wait a few more weeks to settle. 
    It will take many months to work through the appeals process.  And the outcome is not guaranteed.  Apple needed the chips now 

    But as long as the FTC wins at the end, it will not matter.   The contract will get torn up 
    I don't see that happening. 
    Doesn't the ruling mandate that:

    "...Qualcomm must negotiate or renegotiate license terms with customers in good faith under conditions free from the threat of lack of access to or discriminatory provision of modem chip supply or associated technical support or access to software."

    Which could give Apple a leg up on redoing the contract.
    Negotiate - From a go-forward perspective.  Renegotiate - if terms were negotiated under bad faith and threats.  There's nothing available that says Apple and QC negotiated their agreement under bad faith or threats.  In fact, there's a fair contingent of AI forum members who insist it was Apple negotiating from a position of strength so the conditions for renegotiation weren't really present.  We don't know so we can't assume.  Regardless, that excerpt you quoted does not mandate renegotiation.
    Everything in Koh's ruling points to Qualcomm operating under bad faith. Hell, she stopped just short of calling Q's witnesses/executive perjurers. They lost on nearly every count and she mandated government oversight for a period of seven years. The parties are holding the contract close to their vests, so no one can say with definitive proof who won. But given the previous worldwide rulings against Qualcomm, this outcome and the upcoming German trials, Qualcomm will be in a world of hurt.
    You seem to be equating her opinion of Qualcomm's overall actions with those of Qualcomm's actions regarding their settlement with Apple.   Renegotiation would occur if the perceived injured party wants to renegotiate.  There's nothing that says Apple would even want to do so or find advantage in doing so.
    muthuk_vanalingam
  • Reply 24 of 40
    maestro64maestro64 Posts: 4,599member
    ronn said:
    ronn said:
    gatorguy said:
    red oak said:
    wanderso said:
    Seems that Apple might have wanted to wait a few more weeks to settle. 
    It will take many months to work through the appeals process.  And the outcome is not guaranteed.  Apple needed the chips now 

    But as long as the FTC wins at the end, it will not matter.   The contract will get torn up 
    I don't see that happening. 
    Doesn't the ruling mandate that:

    "...Qualcomm must negotiate or renegotiate license terms with customers in good faith under conditions free from the threat of lack of access to or discriminatory provision of modem chip supply or associated technical support or access to software."

    Which could give Apple a leg up on redoing the contract.
    Negotiate - From a go-forward perspective.  Renegotiate - if terms were negotiated under bad faith and threats.  There's nothing available that says Apple and QC negotiated their agreement under bad faith or threats.  In fact, there's a fair contingent of AI forum members who insist it was Apple negotiating from a position of strength so the conditions for renegotiation weren't really present.  We don't know so we can't assume.  Regardless, that excerpt you quoted does not mandate renegotiation.
    Everything in Koh's ruling points to Qualcomm operating under bad faith. Hell, she stopped just short of calling Q's witnesses/executive perjurers. They lost on nearly every count and she mandated government oversight for a period of seven years. The parties are holding the contract close to their vests, so no one can say with definitive proof who won. But given the previous worldwide rulings against Qualcomm, this outcome and the upcoming German trials, Qualcomm will be in a world of hurt.
    You seem to be equating her opinion of Qualcomm's overall actions with those of Qualcomm's actions regarding their settlement with Apple.   Renegotiation would occur if the perceived injured party wants to renegotiate.  There's nothing that says Apple would even want to do so or find advantage in doing so.
    Apple already has a new deal with QCOM, they preempted this decision. It was in QCOM best decision to settle with Apple ahead of this decision. If there is going to be court oversight in any future licensing agreements, QCOM did not want that as part of the Apple deal. No one should kid themselves into thinking Apple and QCOM did not know the outcome of the case, They both knew where it was head and they both agree ahead of time to strike a new deal.
    edited May 22 muthuk_vanalingamchasm
  • Reply 25 of 40
    maestro64 said:
    ronn said:
    ronn said:
    gatorguy said:
    red oak said:
    wanderso said:
    Seems that Apple might have wanted to wait a few more weeks to settle. 
    It will take many months to work through the appeals process.  And the outcome is not guaranteed.  Apple needed the chips now 

    But as long as the FTC wins at the end, it will not matter.   The contract will get torn up 
    I don't see that happening. 
    Doesn't the ruling mandate that:

    "...Qualcomm must negotiate or renegotiate license terms with customers in good faith under conditions free from the threat of lack of access to or discriminatory provision of modem chip supply or associated technical support or access to software."

    Which could give Apple a leg up on redoing the contract.
    Negotiate - From a go-forward perspective.  Renegotiate - if terms were negotiated under bad faith and threats.  There's nothing available that says Apple and QC negotiated their agreement under bad faith or threats.  In fact, there's a fair contingent of AI forum members who insist it was Apple negotiating from a position of strength so the conditions for renegotiation weren't really present.  We don't know so we can't assume.  Regardless, that excerpt you quoted does not mandate renegotiation.
    Everything in Koh's ruling points to Qualcomm operating under bad faith. Hell, she stopped just short of calling Q's witnesses/executive perjurers. They lost on nearly every count and she mandated government oversight for a period of seven years. The parties are holding the contract close to their vests, so no one can say with definitive proof who won. But given the previous worldwide rulings against Qualcomm, this outcome and the upcoming German trials, Qualcomm will be in a world of hurt.
    You seem to be equating her opinion of Qualcomm's overall actions with those of Qualcomm's actions regarding their settlement with Apple.   Renegotiation would occur if the perceived injured party wants to renegotiate.  There's nothing that says Apple would even want to do so or find advantage in doing so.
    Apple already has a new Deal with QCOM, they preempted this decision. It was in QCOM best decision to settle with Apple ahead of this decision. If there is going to be court oversight in any future licensing agreements, did not want that as part of the Apple deal. No one should kid themselves into thinking Apple and QCOM did not know the outcome of the case, They both knew where it was head and they both agree ahead of time to strike a new deal.
    Yeah, your sentiment is similar to my response to Red Oak.  I think Apple and QC did their deal with the FTC in mind.  
    chasm
  • Reply 26 of 40
    spice-boyspice-boy Posts: 837member
    What? I thought governments made monopolies and did not break them up? "Libertarian daydream" 
  • Reply 27 of 40
    chasmchasm Posts: 1,593member
    lkrupp said:
    So does this ruling in any way affect the deal between Apple and Qualcomm?
    Yes, it likely does. From what we know so far, Apple effectively negotiated its own settlement that doesn't stray too far from the lines laid out by Judge Koh. Remember that Apple lowered its "owed royalties" by half, and also got a far more fair rate for Qualcomm's technology on iPhones going forward ($9/iPhone versus $15/iPhone).

    This ruling, if upheld and enforced, will force Qualcomm to use FRAND principles they should have been using all along and must therefore renegotiate every contract it has for technologies covered under those terms. Unless there's irrevocable clauses in their agreement, this likely means further reduced costs for Apple per iPhone. Qualcomm will essentially have to restructure their entire business model, which should mean lower costs for just about anyone else using Qualcomm tech.

    But even if Apple's agreement is so iron-clad that there's no change in costs, this still means Apple is only locked in for six years. They are free to renegotiate the deal in 2025, when they'll have their own 5G modem tech and far, FAR more leverage over Qualcomm -- because by that time Qualcomm's appeal efforts will have failed.

    Qualcomm would be smart to just accept this judgement, restructure their licensing models now, and move forward -- they'll end up owning the market if they do, rather than giving rivals a chance to emerge and take away their business.
  • Reply 28 of 40
    chasmchasm Posts: 1,593member
    lkrupp said:
    No fine, no punishment for Qualcomm? Just a “stop doing that” slap on the wrist?
    That part's not clear yet, that's likely another hearing. But bear in mind that this ruling, if upheld, will cost them many billions in renegotiated and future revenue. They'll have to dismantle and restructure their entire licensing/royalty (ie, INCOME) apparatus, and will have to play by FRAND rules on a lot of their tech. In effect, they've been hit with (easily) a $50B fine across future revenues.
    netmage
  • Reply 29 of 40
    gatorguygatorguy Posts: 20,748member
    This is really good news for we as consumers.

    Those of you buying iPhone's were already going to see your pricing go down as a result of the earlier settlement between Apple and Qualcomm lowering costs, and now those savings are being extended to the rest of the mobile consumers who will see their own device prices go down as a result. Thanks to the FTC they've saved folks like me hundreds of dollars over what I might have expected to pay for new smartphones over the next 5 or 6 years. 

    Qualcomm won't be allowed to continue stealing money from you and me by forcing Apple, Samsung et al to raise the price of those phones they sell to us. 
    edited May 22 ronnMplsP
  • Reply 30 of 40
    ronnronn Posts: 330member
    Everything in Koh's ruling points to Qualcomm operating under bad faith. Hell, she stopped just short of calling Q's witnesses/executive perjurers. They lost on nearly every count and she mandated government oversight for a period of seven years. The parties are holding the contract close to their vests, so no one can say with definitive proof who won. But given the previous worldwide rulings against Qualcomm, this outcome and the upcoming German trials, Qualcomm will be in a world of hurt.
    You seem to be equating her opinion of Qualcomm's overall actions with those of Qualcomm's actions regarding their settlement with Apple.   Renegotiation would occur if the perceived injured party wants to renegotiate.  There's nothing that says Apple would even want to do so or find advantage in doing so.
    I did no such thing. Koh's ruling is not based on the settlement as she likely hasn't seen it, just the evidence from the FTC case argued months before the Apple v Qualcomm trial that was abrubtly settled after opening statements were made. Again, we don't know what the settlement contract entails. I am not making the argument that Apple will definitely ask to renegotiate the newest contract. If Apple believes this ruling is to their benefit, they will fight to redo it given Koh's ruling. And Apple is just one player among many that may use the ruling to obtain better terms for previous contracts (and future contracts) as Koh's ruling mandates that option as one of the remedies for Qualcomm's anti-competitive actions.
  • Reply 31 of 40
    MplsPMplsP Posts: 1,454member
    gatorguy said:
    This is really good news for we as consumers.

    Those of you buying iPhone's were already going to see your pricing go down as a result of the earlier settlement between Apple and Qualcomm lowering costs, and now those savings are being extended to the rest of the mobile consumers who will see their own device prices go down as a result. Thanks to the FTC they've saved folks like me hundreds of dollars over what I might have expected to pay for new smartphones over the next 5 or 6 years. 

    Qualcomm won't be allowed to continue stealing money from you and me by forcing Apple, Samsung et al to raise the price of those phones they sell to us. 
    Agreed. I'm assuming this also affects licensing of FRAND patents to other manufacturers of 5G chips meaning it would make development and sale of such chips by other companies more viable?
  • Reply 32 of 40
    gatorguygatorguy Posts: 20,748member
    chasm said:
    lkrupp said:
    So does this ruling in any way affect the deal between Apple and Qualcomm?
    Yes, it likely does. From what we know so far, Apple effectively negotiated its own settlement that doesn't stray too far from the lines laid out by Judge Koh. Remember that Apple lowered its "owed royalties" by half, and also got a far more fair rate for Qualcomm's technology on iPhones going forward ($9/iPhone versus $15/iPhone).

    This ruling, if upheld and enforced, will force Qualcomm to use FRAND principles they should have been using all along and must therefore renegotiate every contract it has for technologies covered under those terms. Unless there's irrevocable clauses in their agreement, this likely means further reduced costs for Apple per iPhone. Qualcomm will essentially have to restructure their entire business model, which should mean lower costs for just about anyone else using Qualcomm tech.

    But even if Apple's agreement is so iron-clad that there's no change in costs, this still means Apple is only locked in for six years. They are free to renegotiate the deal in 2025, when they'll have their own 5G modem tech and far, FAR more leverage over Qualcomm -- because by that time Qualcomm's appeal efforts will have failed.

    Qualcomm would be smart to just accept this judgement, restructure their licensing models now, and move forward -- they'll end up owning the market if they do, rather than giving rivals a chance to emerge and take away their business.
    According to "sources" this will have no effect at all on the recent Qualcomm/Apple contract.  Zippo...
  • Reply 33 of 40
    carnegiecarnegie Posts: 726member
    lkrupp said:
    So does this ruling in any way affect the deal between Apple and Qualcomm?
    Whether this ruling is likely to affect that deal depends on the accuracy of the narrative, which some pushed, that Apple had effectively capitulated because it needed Qualcomm's 5G modems - i.e. that Qualcomm had most of the leverage before the deal.

    If the leverage Qualcomm had over Apple due to 5G played a large role in the terms that were eventually agreed upon, then Apple will likely seek to renegotiate the licensing deal which it agreed to. It can do so now without being under a threat that it won't have access to Qualcomm's 5G modems. In other words, it can do so now with most all of the leverage on its side. If Qualcomm won't agree to (even) better terms (for Apple), Apple can effectively say... okay then, we'll let the courts decide and, oh by the way, we won't be making royalty payments in the meantime. (Apple would likely still make the agreed-upon payment for royalties due through March 2019).

    That possible scenario evinces the shrewdness of Apple having made the deal back in April. Apple would likely be in an even stronger negotiating position, in the wake of this decision, because it made that deal. Apple and Qualcomm have already agreed to chip supply terms. So Qualcomm couldn't effectively threaten not to supply 5G chips in order to get Apple to agree to more favorable (for Qualcomm) terms. It can't claim that the parties are unable to reach acceptable chip supply terms - without regard to the licensing issue - as a cover for refusing to supply Apple with chips because it won't agree to certain licensing terms.  Qualcomm would be left with the threat of (non-SEP) infringement suits, which had been largely unsuccessful before.

    That said, I don't think the narrative which had Apple largely capitulating to Qualcomm was accurate. I think the information we have, on the whole, supports that it wasn't. I also think this ruling reinforces the notion that that narrative was mistaken. This general ruling - Qualcomm being found to have violated anti-trust laws and being ordered to take certain remedial actions, to include renegotiating licensing agreements without using the threat of cutting off chip supplies - was likely expected by both Qualcomm and Apple. I think it was pretty obviously the likely result for anyone that paid close attention to the trial and objectively considered the issues. So (1) the threat for Apple of not having access to Qualcomm's 5G modems likely wasn't as serious as some have suggested and (2) even if it was serious, Qualcomm would likely have been reluctant to use that threat as leverage to extract from Apple terms which Apple would have otherwise found unacceptable. For Qualcomm, doing that would have meant repeating behavior which regulatory bodies had already told it not to engage in and which Judge Koh was very likely to soon tell Qualcomm it couldn't continue to engage in, and order it to effectively divest itself of the benefits of having previously engaged in.

    So... I suspect this decision won't affect the deal between Apple and Qualcomm that much, in part because this result was likely already largely baked into that deal. 
  • Reply 34 of 40
    carnegiecarnegie Posts: 726member

    I wonder if Apple settled a few weeks too soon. Perhaps it would have been better to wait for this ruling. 
    If anything, I think having previously reached the deal with Qualcomm would put Apple in a stronger negotiating position after this decision. Now it already has a chip supply agreement in place. In light of this decision, Qualcomm would be in no position to back out of that part of the deal. So Apple could seek to renegotiate the licensing agreement without concern that its supply of Qualcomm modems would be jeopardized.

    That said, I don't really expect Apple to try get a much better licensing deal because I think it already mostly got what it wanted. But to the extent it agreed to terms it wasn't happy with, then yeah, it will likely try to renegotiate those terms.
  • Reply 35 of 40
    carnegiecarnegie Posts: 726member

    ronn said:
    gatorguy said:
    red oak said:
    wanderso said:
    Seems that Apple might have wanted to wait a few more weeks to settle. 
    It will take many months to work through the appeals process.  And the outcome is not guaranteed.  Apple needed the chips now 

    But as long as the FTC wins at the end, it will not matter.   The contract will get torn up 
    I don't see that happening. 
    Doesn't the ruling mandate that:

    "...Qualcomm must negotiate or renegotiate license terms with customers in good faith under conditions free from the threat of lack of access to or discriminatory provision of modem chip supply or associated technical support or access to software."

    Which could give Apple a leg up on redoing the contract.
    It would, if we believe that the terms of the Qualcomm - Apple agreement were largely driven by Apple's fear that it wouldn't have a viable supply of 5G modems when it needed them. But, for various reasons, I don't think that was the case. For one thing, I think both parties likely expected this decision to come down substantially as it did.
  • Reply 36 of 40
    carnegiecarnegie Posts: 726member
    lkrupp said:
    No fine, no punishment for Qualcomm? Just a “stop doing that” slap on the wrist?
    The FTC didn't ask for a fine to be imposed. It asked for a finding that Qualcomm had violated anti-trust laws, for Qualcomm to be enjoined from engaging in similar conduct going forward, and for the kind of remedial measures which Judge Koh ordered.
    ronn
  • Reply 37 of 40
    carnegiecarnegie Posts: 726member
    gatorguy said:
    chasm said:
    lkrupp said:
    So does this ruling in any way affect the deal between Apple and Qualcomm?
    Yes, it likely does. From what we know so far, Apple effectively negotiated its own settlement that doesn't stray too far from the lines laid out by Judge Koh. Remember that Apple lowered its "owed royalties" by half, and also got a far more fair rate for Qualcomm's technology on iPhones going forward ($9/iPhone versus $15/iPhone).

    This ruling, if upheld and enforced, will force Qualcomm to use FRAND principles they should have been using all along and must therefore renegotiate every contract it has for technologies covered under those terms. Unless there's irrevocable clauses in their agreement, this likely means further reduced costs for Apple per iPhone. Qualcomm will essentially have to restructure their entire business model, which should mean lower costs for just about anyone else using Qualcomm tech.

    But even if Apple's agreement is so iron-clad that there's no change in costs, this still means Apple is only locked in for six years. They are free to renegotiate the deal in 2025, when they'll have their own 5G modem tech and far, FAR more leverage over Qualcomm -- because by that time Qualcomm's appeal efforts will have failed.

    Qualcomm would be smart to just accept this judgement, restructure their licensing models now, and move forward -- they'll end up owning the market if they do, rather than giving rivals a chance to emerge and take away their business.
    According to "sources" this will have no effect at all on the recent Qualcomm/Apple contract.  Zippo...
    It will be up to Apple whether it wants to renegotiate the terms of the recent deal.

    That will depend, in large part, on whether Apple agreed to less favorable (or otherwise unacceptable) terms because of a threat that it wouldn't have access to Qualcomm's 5G modems or a viable alternative.
  • Reply 38 of 40
    gatorguygatorguy Posts: 20,748member
    carnegie said:
    gatorguy said:
    chasm said:
    lkrupp said:
    So does this ruling in any way affect the deal between Apple and Qualcomm?
    Yes, it likely does. From what we know so far, Apple effectively negotiated its own settlement that doesn't stray too far from the lines laid out by Judge Koh. Remember that Apple lowered its "owed royalties" by half, and also got a far more fair rate for Qualcomm's technology on iPhones going forward ($9/iPhone versus $15/iPhone).

    This ruling, if upheld and enforced, will force Qualcomm to use FRAND principles they should have been using all along and must therefore renegotiate every contract it has for technologies covered under those terms. Unless there's irrevocable clauses in their agreement, this likely means further reduced costs for Apple per iPhone. Qualcomm will essentially have to restructure their entire business model, which should mean lower costs for just about anyone else using Qualcomm tech.

    But even if Apple's agreement is so iron-clad that there's no change in costs, this still means Apple is only locked in for six years. They are free to renegotiate the deal in 2025, when they'll have their own 5G modem tech and far, FAR more leverage over Qualcomm -- because by that time Qualcomm's appeal efforts will have failed.

    Qualcomm would be smart to just accept this judgement, restructure their licensing models now, and move forward -- they'll end up owning the market if they do, rather than giving rivals a chance to emerge and take away their business.
    According to "sources" this will have no effect at all on the recent Qualcomm/Apple contract.  Zippo...
    It will be up to Apple whether it wants to renegotiate the terms of the recent deal.

    That will depend, in large part, on whether Apple agreed to less favorable (or otherwise unacceptable) terms because of a threat that it wouldn't have access to Qualcomm's 5G modems or a viable alternative.
    That "decision" could already be part of the agreed on contract. 
    https://www.bloomberg.com/news/articles/2019-05-22/apple-qualcomm-settlement-expected-to-stand-despite-ftc-ruling
  • Reply 39 of 40
    carnegiecarnegie Posts: 726member
    gatorguy said:
    carnegie said:
    gatorguy said:
    chasm said:
    lkrupp said:
    So does this ruling in any way affect the deal between Apple and Qualcomm?
    Yes, it likely does. From what we know so far, Apple effectively negotiated its own settlement that doesn't stray too far from the lines laid out by Judge Koh. Remember that Apple lowered its "owed royalties" by half, and also got a far more fair rate for Qualcomm's technology on iPhones going forward ($9/iPhone versus $15/iPhone).

    This ruling, if upheld and enforced, will force Qualcomm to use FRAND principles they should have been using all along and must therefore renegotiate every contract it has for technologies covered under those terms. Unless there's irrevocable clauses in their agreement, this likely means further reduced costs for Apple per iPhone. Qualcomm will essentially have to restructure their entire business model, which should mean lower costs for just about anyone else using Qualcomm tech.

    But even if Apple's agreement is so iron-clad that there's no change in costs, this still means Apple is only locked in for six years. They are free to renegotiate the deal in 2025, when they'll have their own 5G modem tech and far, FAR more leverage over Qualcomm -- because by that time Qualcomm's appeal efforts will have failed.

    Qualcomm would be smart to just accept this judgement, restructure their licensing models now, and move forward -- they'll end up owning the market if they do, rather than giving rivals a chance to emerge and take away their business.
    According to "sources" this will have no effect at all on the recent Qualcomm/Apple contract.  Zippo...
    It will be up to Apple whether it wants to renegotiate the terms of the recent deal.

    That will depend, in large part, on whether Apple agreed to less favorable (or otherwise unacceptable) terms because of a threat that it wouldn't have access to Qualcomm's 5G modems or a viable alternative.
    That "decision" could already be part of the agreed on contract. 
    https://www.bloomberg.com/news/articles/2019-05-22/apple-qualcomm-settlement-expected-to-stand-despite-ftc-ruling
    If you mean the decision whether to renegotiate the terms of the licensing agreement, then that decision couldn't (with enforceable effect) be part of the agreed upon contract. Regardless of what the contract says, if Apple now wants to renegotiate the terms of the licensing agreement it can effectively require Qualcomm to do so. That would be an effect of this ruling.

    There are no provisions in the deal between Apple and Qualcomm that allowed for a reversal or change in the event the FTC won its case against the chipmaker, according to one of the people.

    Analysts speculated, following the announcement of the ruling late Tuesday, that the Apple agreement might be automatically invalidated.

    The Qualcomm - Apple agreement wouldn't be automatically invalidated. To the extent there was speculation to that effect, I think it was silly and misunderstands the situation.

    But Apple could require Qualcomm to renegotiate if it wanted to. There don't need to be provisions in the deal for that to be the case. Judge Koh's order makes it the case.

    That said, as I suggested in other posts, I think this (largely expected) decision is likely already baked into the agreement which Qualcomm and Apple reached. The leverage which Qualcomm supposedly had based on Apple's need to have access to 5G modems wasn't as great as some have suggested it was, in part because this decision - i.e. one that looked substantially like it - was coming and expected, I think, by both parties.


    edited May 23
  • Reply 40 of 40
    carnegiecarnegie Posts: 726member
    I'm just getting time to read Judge Koh's full opinion (i.e. Findings of Fact and Conclusions of Law).

    One notable tidbit: It appears that, even with the rebates Apple was getting and the onerous terms it had to agree to in order to get those rebates, Apple was effectively paying $10 per handset under the BCPA rather than $7.50. Jeff Williams testimony wasn't clear on that issue. He indicated that under the previous agreement Apple was effectively paying $7.50, but I didn't see testimony from him that was clear on whether that rate continued under the BCPA.

    This information makes the deal Apple recently got from Qualcomm, based on what we can estimate the likely licensing rates to be, look even better. The rate Apple would have effectively been paying when it started to withhold royalty payments and filed suit was quite a big higher than the $10, and going forward the all-inclusive 5G rate might have been higher still. But even if Qualcomm hadn't stopped paying the rebates, and even if Apple had continued to agree to the other terms which it didn't like, what it would have been paying seems to be above what it eventually agreed to (without it having to agree to other terms and with it getting other things which it wanted - i.e. a direct licensing deal and a long-term chip supply agreement.
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