“The European Union is drawing up guidelines on how much patent holders should charge for their technologies, a thorny issue that pits Apple and other users against Qualcomm and Ericsson,” Reuters reports. “Trillions of dollars in sales are at stake as regulators ponder whether a fridge maker should pay a different rate for crucial patents than a carmaker, or whether a flat, fixed rate would be fairer.”
“The patent fee model used by world No. 1 smartphone chip designer Qualcomm predominates in the tech industry and is based on how much value a technology adds to a product, but is opposed by Apple and others in Silicon Valley,” Reuters reports. “Other models are in use and the EU aims to set a uniform one for Europe, opening a new front in a global dispute that has already seen multiple lawsuits between Apple and Qualcomm.”
“Qualcomm’s patent fee model is based on the widely used so-called ‘fair, reasonable and non-discriminatory’ (FRAND) licensing model. The European Commission, however, has yet to make a final decision on which technology patent fee model it favours. Silicon Valley tech giants have sided with Apple, as have big Asian electronics makers who work for Apple, including Foxconn Technology Group,” Reuters reports. “Qualcomm’s approach sets royalty rates based on the proportion of ‘added value’ the patented technology provides to the completed product. Its previous patent licensing deal with Apple, for example, allowed it to take a percentage of the overall selling price for the iPhone, in exchange for supplying it with modem chips.”
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MacDailyNews Take: The jig is up, Qualcomm.
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.
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