“When it comes to press releases announcing major patent licensing deals, the slightest change in the description of the terms of one deal relative to another can mean a lot,” Eric Jhonsa writes for TheStreet. “That’s definitely the case for Apple’s new settlement with Nokia.”
“Whereas the press release announcing Apple’s 2011 patent-licensing deal with Nokia, as well as the one announcing Apple’s 2015 patent deal with Ericsson, mentioned that Apple would pay ‘on-going royalties,’ Tuesday morning’s release about Apple and Nokia’s latest settlement only talks of ‘additional revenues during the term of the agreement,'” Jhonsa writes. “The change in phrasing probably has much to do with Apple’s wish to prevent the Nokia settlement from hurting its prospects in its increasingly bitter dispute with Qualcomm, a dispute that has featured lawsuits on both sides and strikes at the heart of Qualcomm’s licensing model.”
“Nokia, like Qualcomm and Ericsson, has typically received royalties from mobile licensees that are based on a percentage of a phone’s selling price,Jhonsa writes. “From the looks of things, Apple could be replacing the iPhone royalty payments that were part of the 2011 deal with fixed licensing fees.”
Read more in the full article here.
MacDailyNews Take: Likely.
Qualcomm’s FRAND abuse must not stand. Qualcomm’s licensing scam — charging a percentage of the total cost of all components in the phone, even non-Qualcomm components — is unreasonable, illogical, and irrational.
SEE ALSO:
Nokia and Apple sign patent license and business cooperation agreement, settle all litigation – May 23, 2017
Apple sues Nokia’s patent trolls; says Nokia attempting to ‘compensate for its own failing cell phone business’ – December 21, 2016
Nokia sues Apple in Germany and the US for infringement of Nokia patents – December 21, 2016—
Qualcomm files new lawsuit in ongoing Apple feud targeting four major iPhone suppliers – May 17, 2017
FTC says Qualcomm is a monopoly; Samsung agrees – May 13, 2017
What seems reasonable to Qualcomm isn’t to Apple: Royalty dispute ultimately affects iPhone prices – May 8, 2017
Qualcomm to seek U.S. ITC import ban for Apple iPhones – May 3, 2017
Qualcomm slashes profit forecasts as Apple ceases paying iPhone royalties – April 28, 2017
BlackBerry awarded $815 million in arbitration with Qualcomm over royalty overpayments – April 13, 2017
Qualcomm countersues Apple – April 11, 2017
Qualcomm wants FTC to drop their antitrust suit, but it doesn’t mater because Apple’s isn’t going anywhere – April 5, 2017
Apple’s dispute with Qualcomm could last two years – March 3, 2017
Apple widens global patent war, files lawsuit against Qualcomm in the United Kingdom – March 2, 2017
Apple may have paid Qualcomm $40 per iPhone; accounting for 1/3rd of Qualcomm’s revenue – February 10, 2017
Conservative groups ask President Trump to terminate FCC lawsuit over Qualcomm patent licensing – January 27, 2016
Qualcomm CEO fires back at Apple: Bring it on – January 26, 2017
Apple sues Qualcomm in China seeking 1 billion yuan – January 25, 2017
Qualcomm comments on Apple’s lawsuits in China – January 25, 2017
Apple’s rebellion against the ‘Qualcomm Tax’ – January 24, 2017
Despite lawsuit, Qualcomm wants to keep doing business – January 24, 2017
Why Apple, the FTC, and others are attacking Qualcomm’s royalty model – January 24, 2017
Here are the most damning parts of Apple’s blockbuster lawsuit against Qualcomm – January 23, 2017
Apple’s legal assault on Qualcomm part of iPhone margin grab – January 23, 2017
Qualcomm says Apple’s claims are ‘baseless’ in response to Cupertino’s $1 billion lawsuit – January 21, 2017
Apple sues Qualcomm for $1 billion over onerous licensing practices – January 20, 2017
Qualcomm exec says FTC ‘rushed’ antitrust lawsuit before President-elect Trump’s inauguration – January 19, 2017
FTC alleges Qualcomm forced Apple into iPhone LTE chip deals – January 18, 2017
FTC charges Qualcomm with monopolizing key smartphone chip; alleges extracted exclusivity from Apple in exchange for reduced patent royalties – January 17, 2017
I don’t know how Qualcomm expects to sell RF chips to cell phone makers 5-7 years down the road.
The incentive for competitors and in-house development of replacement chips by the likes of Apple is very very high at this point. I agree that RF chip design is not Apple’s biggest chip expertise, but they can find people or a small company to buy.
Apple does have the cash to buy Qualcomm.
Doesn’t matter who makes the chips if Qualcomm can charge whatever it likes for use of its standards-essential software patents. That’s what the lawsuit is about.
If the lawsuits proceed to closure, then the court will determine an appropriate FRAND rate and assess Apple’s charges accordingly. I don’t know how the court will handle Qualcomm’s withheld $1B kickback to Apple.
It seems likely to me that Qualcomm may realize that their defense is weak in terms of their FRAND licensing policies and seek to negotiate a private, out-of-court settlement with Apple rather than risk a precedent-setting court decision that other Qualcomm customers would use to renegotiate their own contracts. But I personally hope that Apple rejects any OOC settlement that involves any secrecy regarding the terms of the settlement. In that case, Apple should pursue the court case to the bitter end.
If Apple manages to produce its own RF chip, they should make a version to sell to the market in competition with Qualcomm.
To repeat, it does not matter who makes the chip. It is impossible for any phone, computer, or other device to communicate with a cellular network without using the Qualcomm software patents that are embedded into the network protocols. That is what it means for a patent to be standards-essential: its use is unavoidable for anybody who wants their equipment to function.
When Qualcomm submitted their patents for inclusion in the standard protocols, they were required to agree to license the patents to anybody who wanted to follow the standards. Because Qualcomm still owns the patents (a government-regulated monopoly), they were entitled to charge for using them on a fair, reasonable and non-discriminatory basis. Qualcomm claims that charging a percentage of the price of the entire device is reasonable, while Apple (and almost everybody else) disagrees.
Nobody disputes that Qualcomm is owed reasonable compensation, no matter whether they, Intel, or Apple makes the hardware chips that use the software patents. That is why Apple is continuing to deposit royalty payments (at the Qualcomm rate) into an account that will be used to pay Qualcomm when the rate question has been resolved by the courts or by agreement.
Qualcomm: