© tom_schmucker dreamstime.com Business | April 15, 2019
The “meat” of Qualcomm’s business model on trial in San Diego
Apple Inc. and its allies square off in a jury trial today against chip supplier Qualcomm Inc. The trial, taking place in San Diego, seeks to determine whether Qualcomm has engaged in illegal patent licensing practices. The plaintiffs are seeking up to USD 27 billion in damages.
In a story filed by Reuters on Friday, and reported on previously in various media outlets, Qualcomm is alleging that Apple forced its longtime business partners to quit paying some royalties and is seeking up to USD 15 billion. Filed in federal court by Apple in early 2017, the lawsuit focuses on the modem chips that connect devices like the iPhone or Apple Watch to wireless data networks. Qualcomm has spent the past two years mounting a pressure campaign of smaller legal skirmishes against Apple, seekingꟷand in some cases winningꟷiPhone sales bans for violating its patents. For Apple, the trial is about the freedom to determine its own technology path for blockbuster products by buying chips without having to pay what it calls a “tax” on its innovations in the form of patent licensing fees to Qualcomm that take a cut of the selling price of its devices. For Qualcomm, the trial, along with similar allegations from U.S. regulators in a January court hearing, will determine the fate of its unique practice of mixing the sale of chips and licensing more than 130,000 patents. Gaston Kroub, a patent attorney with Kroub, Silbersher & Kolmykov, who is not involved in the case, told Reuters, “This is the day of reckoning that Qualcomm has been very fortunate to avoid for many years. In Apple, they’ve finally come up against a potential licensee that has the resources and the will to put Qualcomm’s business model and licensing practices on trial.” At center is Qualcomm’s practice that requires device makers to sign a patents license before it will supply chips, which it views as a commonsense measure to ensure it does not do business with companies violating its patents. Apple and other companies have called the “no license, no chips” policy a form of “double dipping.” In other words, Qualcomm is charging for the same intellectual property once during licensing discussions, and then again in the price of the chips where the patents manifest. Apple and allies are asking for an end to the double-dipping practice and a refund of about USD 9 billion, which may be tripled if the jury finds in Apple’s favor for antitrust allegations concerning contract factories such as Foxconn, who paid the royalties and were reimbursed by Apple. Apple alleges the practices kept Intel Corp. and other rivals like them out of the market for years. “Even very big companies like Intel have felt at a disadvantage,” said Michael Salzman, an antitrust attorney with Hughes Hubbard & Reed not involved in the case. Qualcomm’s position, according to the Reuters report, is that it has successful working relationships with contract factories prior to the release of the Apple iPhone. But Apple leveraged its strength in the industry to persuade factories to break their longstanding contracts with Qualcomm, which led to at least USD 7 billion in royalties lost, the chip supplier alleges. “I don’t think (a Qualcomm victory) would be great for Apple, but if it’s about money, they’ve got plenty of money,” said Stacy Rasgon, an equity analyst for Bernstein who follows Qualcomm. “For Qualcomm, it’s an existential attack on the meat of their business model.”
MagnaChip Semiconductor to sell its foundry business and Fab 4 MagnaChip Semiconductor says that certain of its wholly-owned subsidiaries have entered into a definitive agreement to sell the company's Foundry Services Group and the factory in Cheongju (Fab 4), the larger of the company's two 8" manufacturing facilities.
Singulus Technologies temporarily reduces business operation Against the backdrop of the current situation related to the spread of COVID-19 and the resulting restrictions in private and business lives, Singulus Technologies is implementing short-time work at two of its German sites.
Kyocera to acquire Japan-based Showa Optronics Kyocera Corporation has entered into a share transfer agreement with NEC Corporation on March 25, 2020 to acquire all of NEC’s shares in Showa Optronics Co., Ltd., an optical components manufacturer.
Analog Devices withdraws second quarter outlook The economic and social effects caused by COVID-19 are currently creating supply chain disruption and uncertainty around future demand.
Movement control order restricts production for Renesas in Malaysia Due to a Movement Control Order announced by the Malaysian government, Renesas three production sites located in the country temporarily halted productions from March 18, 2020.
TTI remains operational during COVID-19 pandemic TTI, Inc. says it remains open following the guidelines mandated by local and federal governments during the COVID-19 coronavirus outbreak, with precautions in place to safeguard employees’ health.
Nokia completes acquisition of Elenion Technologies Nokia says it has completed its acquisition of U.S.-based supplier of silicon photonics technology, Elenion Technologies.
Nexperia CEO Frans Scheper retiring On March 24, 2020, Nexperia announced that CEO Frans Scheper has decided to take early retirement and will step down as Nexperia CEO and Management Board Member per March 25, 2020.
Intellitronix seeing interest from Ford Ohio-based Intellitronix Corporation, a subsidiary of US Lighting Group, has been invited by the Ford Motor Company to submit a proposal to design and manufacture an automotive electronics component for one of the automaker’s upcoming vehicles.
NEXT Biometrics receives additional order from government program in India NEXT Biometrics has received an additional order for UIDAI and STQC certified fingerprint biometric readers in India valued at USD 360,000. The customer has provided a 20% upfront payment and the readers have been delivered to the customer.
Elmos is planning short-time work Because of the global corona pandemic, Elmos Semiconductor AG is planning to introduce short-time work of up to 50%.
paragon reacts to production stoppages by carmakers paragon is set to take immediate action in response to moves by automotive manufacturers closing down their plants. The company is now reducing production at its automotive manufacturing sites in Germany to a minimum for the time being.
STMicro to temporarily cut 50% of French production The semiconductor company has reportedly agreed to temporarily reduce its production in France by up to 50% as the company works to stymie the spread of COVID-19.
The Infineon site in Villach is growing Infineon’s investment in a new automated chip factory and a research building at its site in Villach is making progress.
Panasonic eyes multi-use potential for PanaCIM Panasonic, in their push more deeply into smart manufacturing solutions, has partnered with MiR and Inovaxe to develop a handy helper: the PanaCIM Solutions Ecosystem.
Rutronik & Gowin inks distribution agreement for EMEA and NA Rutronik Elektronische Bauelemente GmbH is expanding its portfolio to include the Gowin Semiconductor Corp. product range.
Autotalks’ global V2X solution passes dual-band Wi-Fi pre-certification V2X (Vehicle-to-Everything) communication solutions provider, Autotalks, has successfully completed Wi-Fi 5 pre-certification for its evaluation kit based on its 2nd generation V2X chipset.
First Sensor names new CFO First Sensor AG has appointed Marcus Resch as the Chief Financial Officer of First Sensor AG effective March 14, 2020, for a period of three years.
TE Connectivity acquires majority share of First Sensor TE Connectivity has completed its public takeover of Berlin-based First Sensor AG. TE now holds 71.87% shares of the German company.Load more news