Patently absurd: Qualcomm charges a 5% wireless patent royalty on iPhone repairs

“The FTC v. Qualcomm trial in San Jose just ended about three weeks ago, and we’re already approaching the Apple & contract manufacturers v. Qualcomm trial in San Diego,” Florian Mueller writes for FOSS Patents. “On Saturday [February 16th], Apple, its four contract manufacturers (Foxconn, Pegatron, Wistron, Compal) and Qualcomm filed a joint pretrial brief on disputed contract provisions. The 76-page document serves as a preview of various issues.”

“There are so many issues that I wouldn’t even know where to begin if one of them didn’t stand out because it’s extraordinarily absurd and one of the best examples of hidden costs that we — the consumers — don’t know about until they surface in litigation,” Mueller writes. “But whether or not we know about them, we’re the ones to foot the bill at the end of the day.”

“Qualcomm wants a 5% patent royalty (with a $400 cap for the royalty base) on smartphones. 3.25% of that relates to standard-essential patents, though I haven’t seen Qualcomm successfully enforce even one of those SEPs in all those years. The related dollar amount will be illusory the moment its wireless SEPs must be licensed at the chipset level. Another 1.75% relates to non-standard-essential patents, and after almost two years of non-SEP infringement litigaton against Apple, Qualcomm has no real leverage. News cycles aren’t leverage,” Mueller writes. “So there’s a problem with what they charge, but until I read this pretrial brief, I was unaware of there being another problem with the wide net they cast when actually collecting their royalties. Apple and its contract manufacturers complain that when Qualcomm performs audits, it insists on getting its 5% on whatever Apple pays to a company like Foxconn: not only the device, but also any services, including repairs.”

Read more in the full article here.

MacDailyNews Take: Unbelievable. How many billions have the Qualcomm extortionists bilked everyone out of over the many years they’ve been extorting?

As we wrote just this morning: Tick-tock, Qualcomm extortionists. Your time of reckoning is coming.

German court stays Qualcomm patent infringement suit against Apple; patent-in-suit likely invalid – February 26, 2019
Apple’s workaround for German fake injunction exacerbates Qualcomm’s antitrust woes – February 14, 2019
Apple resumes selling iPhones in Germany, but with only Qualcomm modems – February 14, 2019
South Korean Supreme Court upholds $242 million antitrust judgement against Qualcomm – February 12, 2019
Bad news piles up for Qualcomm in Apple dispute – February 10, 2019
Apple wins damages ruling against Qualcomm – February 5, 2019
U.S. FTC: Evidence is ‘overwhelming’ that Qualcomm engaged in exclusionary, anticompetitive conduct – January 30, 2019
Leaked emails reveal new reason why Apple went to war with Qualcomm – January 18, 2019
Apple’s COO Jeff Williams delivers blistering testimony on Qualcomm’s ‘onerous demands’ – January 15, 2019
Apple was paying Qualcomm over $1 billion per year in licensing – January 15, 2019

[Thanks to MacDailyNews Reader “KenC” for the heads up.]


    1. If the patents aren’t standards-essential, there was no need to use them. If a customer chooses to use them, he shouldn’t complain about being asked to pay the price agreed to in the purchase agreement.

      Standards-essential patents are an entirely different question, of course. There is a legal obligation then to charge a fair, reasonable, and non-discriminatory price.

    1. What should we call a company that solders in commodity RAM inside its sealed boxes and then charges its customers a 300% markup at time of purchase, while refusing any possibility of future repairs or upgrades?

      That is a shit fruit company.

Reader Feedback

This site uses Akismet to reduce spam. Learn how your comment data is processed.