Apple & Qualcomm Ping!
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Posted on 05/23/2019 11:45:19 PM PDT by Swordmaker
The Federal Trade Commission (FTC) of the United States has won the first round of litigation against Qualcomm. Judge Lucy H. Koh of the United States District Court for the Northern District of California has just found that the San Diego-based chipset maker violated the FTC Act, and has ordered the following remedies:
(1) Qualcomm must not condition the supply of modem chips on a customer’s patent license status and 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.
(2) Qualcomm must make exhaustive SEP licenses available to modem-chip suppliers on fair, reasonable, and non-discriminatory ("FRAND") terms and to submit, as necessary, to arbitral or judicial dispute resolution to determine such terms.
(3) Qualcomm may not enter express or de facto exclusive dealing agreements for the supply of modem chips.
(4) Qualcomm may not interfere with the ability of any customer to communicate with a government agency about a potential law enforcement or regulatory matter.
(5) In order to ensure Qualcomm's compliance with the above remedies, the Court orders Qualcomm to submit to compliance and monitoring procedures for a period of seven (7) years. Specifically, Qualcomm shall report to the FTC on an annual basis Qualcomm’s compliance with the above remedies ordered by the Court.
(Excerpt) Read more at fosspatents.com ...
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Judicial overreach tying the hands of a successful American company doing business in a tough space. Last I heard, the Trump administration was trying to prevent Huawei and other Chinese players from controlling our cellular tech. Qualcomm or Chi-com, take your pick. I’ll go with the former.
You obviously don’t understand the case, The Qualcomm practices in licensing are being slapped down all over the world for violating their Standard Essential Patents (SEP) and to license those patents for rates that are Fair, Reasonable And Non-Discriminatory (FRAND) agreement contracts with the international standard setting organizations. Qualcomm got hit with a 1.5 billion Euro fine for doing the same thing in the EU. It has nothing to do with anything except Qualcomm breaking their contracts and attempting patent hold-ups in contravention of Standard Essential Patent agreement contracts with various cellular device agencies around the world. There are draconian penalties in the EU for violating the FRAND agreements on SEPs.
About five years ago Samsung was going to be hit with a fine equal to its world wide profit for refusing to license its SEPs to Apple unless Apple would agree to cross license the iPhone’s non-SEP patents and copyrights to Samsung in exchange. . .the fine amount would have totalled almost $15 billion dollars! Apple had taken Samsung to court and forced a reasonable FRAND rate, but the EU courts took it to their SEP enforcement prosecutors. . . Samsung negotiated the fine down to under $1.75 billion, but it took some desperate moves on their part. Incidentally, Nokia tried the same thing, but didn’t get fined. The EU takes SEP violations much more seriously than we do.
Some of these agencies and their SEP contracts have the authority to totally invalidate Qualcomm’s SEP patents if they don’t start honoring their SEP obligations to the letter of those agreements. Qualcomm asked to have their patents included in the standard and agreed to the terms when they were adopted as part of the technical standard. They can’t change their mind and just ignore the contract. There are consequences the courts must enforce.
That’s all fine and dandy but at some point national security trumps everything else. Dollars to doughnuts Koh’s ruling gets tossed on appeal. Will circle back to this thread when it happens. Stay tuned.
Pfffft. There is no “standard”.
Apple tried to develop Intel as a second source for modem chips. Indeed, many models of iPhone use inferior Intel modems.
Going forward, Intel simply lacked the technological capability to create a modem for 5G leaving Qualcomm the only player in the game. That’s why Apple recently had to settle with Qualcomm or not get to 5G.
Let’s punish Qualcomm innovation. That’ll work out well.
Well, that'll leave a mark.
No, it won’t. What part of “International Standard” do you fail to grasp? National security has ZERO to do with these patents. This technology is already out there. In fact, Huawei 5G modems and CDMA modems have exactly the same flaws that were found to exist in Qualcomm chips . . . showing they were complete rip offs of the Qualcomm products and software. This genii cannot be put back into a “security” bottle since it is part of an international standard. These patents are also patented in Europe, China, South Korea, Japan, Russia, and several other nations as well. Qualcomm has lost in each of those venues where they’ve been sued for their licensing hold-ups.
This FTC case is not actually based on the patent questions but on antitrust issues where they were using those patents in anti-competitive ways, and according to everything I’ve read, the case is pretty airtight. Courts are not going to toss something so obviously in violation of Federal Law on “national” considerations, when the courts are just enforcing the contracts and agreements that Qualcomm voluntarily signed to allow the cellular communications system to work.
Intel was licensing the patents from Qualcomm. . . but they could not get their chips to perform as well. That does not mean there is no standard. There is a Standard Essential Patent set that must be used/ by every manufacturer of cellular device simply to even connect to the network. If you think there isn’t, then you don’t know what you are talking about.
Intel CDMA and LTE modem chips worked fine. . . but their attempts to develop an alternative 5G system foundered. The two different modems in the iPhones performed the same, no matter which one you had in your iPhone because the better performance in the Qualcomm modem was disabled. Speed wise, you would not notice any difference between a high-end Android phone with the Qualcomm higher speed modem enabled and an iPhone without it, because the iPhone has a far faster CPU than any Android phone. Real time downloads results were still faster for most purposes on the iPhone due to the faster CPU processing.
Nope. By your own admission Intel couldn't keep up with Qualcomm and therefore Intel was inferior. There are loads of links similar to the one below.
Apple confirmed limiting iPhone 7 Qualcomm modem to keep performance on par with Intel chip
There is a Standard Essential Patent set that must be used/ by every manufacturer of cellular device simply to even connect to the network.
Well then, I invite you to provide to me the specific numbers of these patents. If you mean there's a common communication protocol then that's true.
You really don’t know what you are talking about, do you? Qualcomm invented CDMA and holds the patents on it. Regardless of whether a chip is made by Intel or Qualcomm or Huawei, the chip maker MUST license the patent for CDMA from Qualcomm (except, of course for Qualcomm itself) because those patents are in the INTERNATIONAL STANDARD!
The Qualcomm modem was required to connect to the Verizon network but not necessary for any other network in the world. The only iPhones or iPads with the Qualcomm modem are those locked to Verizon originally (they will also work with every other network) or those sold unlocked. Even on Verizon, the higher speeds are not functions available to any make phones until quasi-5Ge was rolled out, so why worry about it. As I said, the speed of the iPhones still bests any Android phone due to the Apple CPU being almost twice the speed of the fastest Android processor.
The whole point of this suit was that Qualcomm was refusing to license its chip patents even though they had placed them in the standard. If they did not want to license the chip designs, they should not have designated them as part of the standard, and kept it only to the basics.
Qualcomm does not own the patents for LTE or 5G and to use those, they must license them from the SEP pool, just like everyone else. . .
The list of patents in the Standard Essential Patent pool for cellular communications would be meaningless to you. There are over 350,000 currently active cell phone patents and of them about ~30% are Standard Essential Patents, many of which are covered by joint license agreements for which one license covers a large group of patents in a product owned by the holder. In cellular communications in 2016, one study found there were 2,552 FAMILIES or categories of SEPs alone, in which SEP patents are sorted.
To put that in perspective, there are over 115,000 families of SEPs for digital communications patents. The cellular SEPs are a subset of that. . . These are all maintained by international standard setting organizations (ISSO) in each industry. These were formed by industry manufacturers to avoid the kind of chaos that exemplified the early electronics industry when various brands tried to establish their own makes as incompatible standards in very competitive markets and none could survive as no one would cede ground to another competitors’ choices.
In the ‘70s and early ‘80s there were five completely incompatible large scale full length movie disk systems from major makers, MCA, Sony and Pioneer LaserDisc, RCA capacitance disks, an actual grooved system with stylus, JVC VHD cartridge—another capacitance system, and a French magnetic disk system. The studios tried but could not produce content for all of them. The most successful was LaserDisc, but its superior format did not survive the war. Then came the smaller Sony Blu-ray v. Toshiba HD-DVD war. . . Which was won by Blu-ray. There is now an ISSO with a SEP pool for Blu-ray.
“...It was just three weeks ago that Apple and Qualcomm entered into a peace treaty. The revelations about Apple’s coordinated efforts to manipulate the licensing market by shrewdly challenging inferior patents to beat down prices should have led to the FTC dropping its pursuit of Qualcomm.
“It is no secret that Apple has urged regulators all over the world to chase Qualcomm for alleged anticompetitive licensing practices, but it has now come out in federal court proceedings that Apple just didn’t like the rate it agreed to pay Qualcomm and decided to manipulate the marketplace and then use that manipulation to pull the wool over the eyes of regulators, including the FTC, in an attempt to leverage a better deal with Qualcomm.
“Apple succeeded in achieving peace with Qualcomm, although the company has been badly beaten by Apple in near collusion with regulators all over the world. So why would the FTC continue to persecute Qualcomm given the revelations in the Apple/Qualcomm litigation that demonstrate that Qualcomm did not seek an unreasonably high licensing rate?
“Indeed, the facts that came out in the Apple/Qualcomm litigation demonstrate clearly, through Apple memoranda, that Apple believed Qualcomm’s patent portfolio to be more valuable than others in the space and engaged in a coordinated effort to challenge those weaker portfolios to beat down the license rates of those inferior portfolios. They then refused to negotiate with Qualcomm, which in and of itself, should have prevented any entitlement to claim rights to FRAND (fair, reasonable and non-discriminatory) rates.
“All the while, Apple was hoping to dupe decision makers into actually believing the licensing rates for the patents they knew were inferior were relevant when determining the licensing rate for Qualcomm’s significantly higher quality patent portfolio. Sadly, it seems as if it worked. Judge Koh bought it, and so did the FTC...”
I’m still waiting for those patent numbers.
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