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grkm3

macrumors 65816
Feb 12, 2013
1,038
559
They have no legal standing to deny Apple a 5G modem. They’d lose any legal challenge so fast.

Also, you don’t seem to understand the basis of the case. Apple doesn’t think it’s right for Qualcomm to charge them for licensing AND charge the people who create the modems.

What do you mean? Qualcomm sells the modem chip and they manufacturer the chip and sell it to oems.
 

ersan191

macrumors 68000
Oct 26, 2013
1,601
3,175
It sounds to me like Apple wants to be able to charge more for its phones than other companies but doesn't feel it should have to pay higher royalties to Qualcomm than them for the exact same technology (since the royalties are based on the total price of the phone for some reason). This seems reasonable to me, though I'm personally still not sold on a $1000 phone.
 

grkm3

macrumors 65816
Feb 12, 2013
1,038
559
Or, Apple works zealously on patent law education and knows when it's violated... the more likely source of this.
[doublepost=1498062542][/doublepost]
What'd Apple do to you to make you biasly side with Qualcomm in this? Qualcomm is completely wrong and not a person on this forum, let alone in a court, should side with them.
There not wrong they have built the foundation of our whole wireless base and invented and own the tech we all use.

You notice why Verizon uses cdma? It's because for the last 15 years it's been damn right the best cell phone service and call quality over any other standard and Qualcomm owns that tech.

Why is it wrong for them to charge 15 bucks for the whole damn modem that includes all license to Qualcomm? The Intel modem sucks ass and won't work at all on Verizon.
 

Carnegie

macrumors 6502a
May 24, 2012
820
1,947
Exactly. The idea of FRAND is that the people who created, or helped create standards, will get paid for it but at the cost of not being able to be outrageous with their patent costs.

And there's a nuanced aspect of the consideration which many gloss over or don't take into account at all.

An SEP holder isn't entitled to whatever additional value is created by their SEP's use in a standard. A lot of the value of such patents is created by their being part of a standard and the resulting reality that industry participants have to use those technologies rather than other possibilities which exist or which might have been developed.

If a given SEP (or group of SEPs) hadn't effectively been incorporated into a standard, what would it be worth? That varies considerably from SEP to SEP, but for a lot of them the value would be very small (or perhaps even nil, as there are already better ways of doing what they seek to achieve).

At any rate, U.S. courts have been clear in that SEP holders are not entitled to value which is created by their SEPs being parts of standards. They aren't entitled to compensation based on the reality that industry participants are required to use them because they are parts of standards.
 

78Bandit

macrumors 6502a
Jun 13, 2009
688
1,252
While I do understand the difference between a FRAND issue and the voluntary use of the App Store, this is somewhat analogous to the 30% "Apple Tax" on payments for digital goods made through an app. If I buy a subscription to Microsoft Office or another vendor offering a digital good Apple is going to take its 30% vig based on the value of what I'm buying from the other company, not what Apple is contributing. Apple is essentially saying the same thing Qualcomm is, "The simple fact we facilitate the service is what makes the end product valuable. If it wasn't for us you couldn't do all the great things you do and we deserve to be compensated based on your revenue stream."

Apple is being hypocritical.
 
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Michael Goff

Suspended
Jul 5, 2012
13,329
7,421
While I do understand the difference between a FRAND issue and the voluntary use of the App Store, this is somewhat analogous to the 30% "Apple Tax" on payments for digital goods made through an app. If I buy a subscription to Microsoft Office or another vendor offering a digital good Apple is going to take its 30% vig based on the value of what I'm buying from the other company, not what Apple is contributing. Apple is essentially saying the same thing Qualcomm is, "The simple fact we facilitate the service is what makes the end product valuable. If it wasn't for us you couldn't do all the great things you do and we deserve to be compensated based on your revenue stream."

Apple is being hypocritical.

No, it is nothing like the App Store model. You say you understand the difference between a SEP/FRAND issue and choosing to go to an App Store, but you clearly either don’t or you’re just arguing because you can. I can use a phone without ever touching the App Store. Try using a phone without the SEP around 3G or CDMA. You probably won’t be able to do these things like "make a phone call".
 
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kruegdude

macrumors 6502
Aug 10, 2011
290
210
"Qualcomm Says Its Innovations Are At the Heart of Every iPhone

...snip...

Qualcomm's patented inventions make possible not only connectivity and high-speed data transmission across mobile networks, but also high-precision GPS navigation, app store operations,
...snip..."


So are they going after Verizon and AT&T then since their inventions are at the heart of every call? The possibilities are endless.
 

syndalis

macrumors regular
Jan 23, 2008
119
183
It sounds to me like Apple wants to be able to charge more for its phones than other companies but doesn't feel it should have to pay higher royalties to Qualcomm than them for the exact same technology (since the royalties are based on the total price of the phone for some reason). This seems reasonable to me, though I'm personally still not sold on a $1000 phone.

Right.

Also this insane idea that they are entitled to a % of the entire sale and not just the cost of the component they are responsible for is one of the key reasons we don't have a glut of LTE-capable macbook pros, surfaces, etc. It's harmful to the advancement of technology.
 
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ApfelKuchen

macrumors 601
Aug 28, 2012
4,334
3,007
Between the coasts
Apple doesn't make touch sensors. They didn't invent the technology.

Neither did Qualcomm. The question remains, should the royalties for the radios in a smartphone be based on the entire value of the smartphone, which contains a wide range of patented technologies that Qualcomm does not own?

This approach made more sense in the days of flip phones, when the current royalty system was hammered out - there was far less of a price spread between the cheapest and most expensive phones, and the other features of the phone were so poorly executed (horrible cameras, unusable web browsers, awkward to use autodialers, etc.) that they added little perceived value in the eyes of the public. The rise of the smart phone allowed the phone makers to add features that enhanced the perceived value of the device to consumers - cameras good enough to replace their point-and-shoots, CPUs capable of supplanting desktop computers, music players that could replace their standalone iPods and Zunes, displays large enough to show movies and personal photo albums, enough Flash storage to hold it all... It doesn't matter who invented any one of those capabilities, what matters is that Qualcomm believes it's due a royalty on all of it.

Sure, telecommunications still sits at the core of the device - without communications there is no web browsing, no photo sharing, no music streaming. It's not a matter of whether the patents are unimportant, but rather whether they're all-important.

Imagine if someone held a fundamental patent on the automobile tire. Without it, no vehicle could move. Would it be justifiable for the tire-maker to assess a percentage royalty on the value of the car - the leather upholstery, air conditioning, optional V-8 engine, Bose entertainment system, anti-lock brakes, emission controls...? Or is it more justifiable to build it into the price of the tires?
 

rjohnstone

macrumors 68040
Dec 28, 2007
3,858
4,443
PHX, AZ.
"Qualcomm Says Its Innovations Are At the Heart of Every iPhone

...snip...

Qualcomm's patented inventions make possible not only connectivity and high-speed data transmission across mobile networks, but also high-precision GPS navigation, app store operations,
...snip..."


So are they going after Verizon and AT&T then since their inventions are at the heart of every call? The possibilities are endless.
That would be like requiring every cell phone owner to acquire a license from Qualcomm.

Carriers do not pay a license directly to Qualcomm. The equipment they buy includes the cost of the license.
The manufacturer of the equipment is responsible for the license costs.

Apple is the hardware vendor and they are responsible for acquiring the licenses needed to make their phone function correctly.
 

zchrykng

macrumors member
May 31, 2017
55
153
That would be like requiring every cell phone owner to acquire a license from Qualcomm.

Carriers do not pay a license directly to Qualcomm. The equipment they buy includes the cost of the license.
The manufacturer of the equipment is responsible for the license costs.

Apple is the hardware vendor and they are responsible for acquiring the licenses needed to make their phone function correctly.

As I understand the case, Apple doesn't have an issue with paying for the required licenses. They just don't think the payment should be based on % of the entire device, that they shouldn't have to pay for licenses twice (themselves and built into the price of the components they purchase), and that Qualcomm is charging a more than FRAND rate for their patents.
 

ani4ani

Cancelled
May 4, 2012
1,703
1,537
Qualcomm really is making itself look ridiculous here. It doesn't matter if your innovation is the single reason the iPhone is successful. If you signed a deal, you signed a deal.
I think that's the point ...they did sign a deal, except Apple no longer thinks it's reasonable
 
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Vanilla35

macrumors 68040
Apr 11, 2013
3,344
1,453
Washington D.C.
Apple likely sat on this while QCOM has been the sole source for cellular modems. Now that AAPL sources modems from INTC, it has some leverage. The question is if this is an indication AAPL will sole source modems from INTC for future products, including CDMA modems. Even if the QCOM modems have 1% better LTE performance, who give a **** since the INTC modems are capable of 1 Gbps and the carriers can't support it yet anyway.

The 7560 supports LTE, GSM, CDMA, and TD-SCDMA (China) in one package. This allows AAPL to have a single SKU world wide, including China. This coupled with eSIM would significantly reduce manufacturing, distribution, and inventory complexity.

https://www.intel.com/content/www/us/en/wireless-products/mobile-communications/xmm-7560-brief.html


View attachment 705033

Time to short QCOM and buy INTC!

You're misinformed if you think the the difference between the two radios is 1% in real world scenarios. Theoretical max isn't everything.
 
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Swift

macrumors 68000
Feb 18, 2003
1,812
956
Los Angeles
Qualcomm will soon discover they have no friends in the industry. They've been milking it long enough. Nobody says they shouldn't be paid. But they've been gouging, which is clear once Intel entered the market.
 

Defthand

macrumors 65816
Sep 1, 2010
1,351
1,712
Apple argued that Qualcomm has been unfairly "levying its own tax" on the iPhone's innovations by charging royalties on a percentage of the entire smartphone's value, despite supplying just a single component of the device.

Not unlike Apple's App Store receiving a 30 percent take for 99¢ and $4.99 apps alike, even though the provided service is the same for both.
 

tongxinshe

macrumors 65816
Feb 24, 2008
1,035
604
What a well-crafted intentionally misleading statement!

The phrase "make possible" is the key, so that he can basically list all technologies that involve data transmission, and that's where its role ends, for all of the long technologies he lists in the second half (after "but also") of his sentence. He is such a great lawyer -- blatantly lie using factual statements.

And, "less than what Apple charges for a single wall plug."? Sure, go ahead and set up a retail network and retail your patents at the same price, see how the retail costs make you bankrupt in just several weeks!
 
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Jsameds

Suspended
Apr 22, 2008
3,525
7,986
Wrong. Without the algorithms running in and on the Qualcomm chips you couldn't even connect to a cell tower, let alone to hand off between them. Let's see Apple build a phone and do all their own innovation. No outside chips....
I'll wait the 20 or so years while they spend a couple of hundred billion on R&D and develop new ways around the existing patents.

The argument you make is specious at best.
Here is an article https://www.greyb.com/starpatents-in-qualcomm-patent-portfolio/ about Qualcomm and it's patens and why they are valuable.

Apple wants to claim that Qualcomm has trivial patents and argues some are even worthless.
Hardware engineers know better and this is the bean counters and lawyers.
Veterbi was brilliant and made cell phone technology possible.

BTW - I'm not an Apple hater. I own and have owned Apple stock for almost two decades.
I'm a hardware engineer and know the value of technology.

My apologies. Thanks for the explanation.
 

rjohnstone

macrumors 68040
Dec 28, 2007
3,858
4,443
PHX, AZ.
As I understand the case, Apple doesn't have an issue with paying for the required licenses. They just don't think the payment should be based on % of the entire device, that they shouldn't have to pay for licenses twice (themselves and built into the price of the components they purchase), and that Qualcomm is charging a more than FRAND rate for their patents.
Apple doesn't pay twice as they claim.
The license to manufacture the chip does not include a license for the software.
Apple pays two separate licensing fees... one for the hardware and one for the software.
Apple wants the chip maker to incur the full cost of the licensing and then pass that cheaper fee onto Apple as part of the device fee. It would be cheaper because Qualcomm charges the software fee based on the device total cost.
If the fully licensed device is only the chip, the fee would be MUCH smaller.
This is why Qualcomm splits the licensing. It's more profitable for them.
 

tongxinshe

macrumors 65816
Feb 24, 2008
1,035
604
Not unlike Apple's App Store receiving a 30 percent take for 99¢ and $4.99 apps alike, even though the provided service is the same for both.

The key is not the sales price of the product, but the product's nature. For dumb phones (some sells for $20, some for $100), the cellular technology is the only core technology, while for smartphones, the cellular technology is just one of the ever growing numbers of multiple core technologies. In some sense, the cellular technology is not even the most important core technology in the smartphones. As a result, it is definitely wrong for the cellular technologies to charge the same royalty rate against smartphones as against dumb phones.

Further more, given the fact that the industry is introducing more and more core technologies into smartphones, the idea of calculating cellular technology royalties on the full price of the smartphones should actually be revised.
[doublepost=1498072940][/doublepost]
Apple wants to claim that Qualcomm has trivial patents and argues some are even worthless.

When did Apple say that? I never see news about Apple making this obviously wrong statements.
 
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bollman

macrumors 6502a
Sep 25, 2001
558
1,068
Lund, Sweden
I totally side with QC here. I say their licensing terms are very FR. It enables manufacturers to use state of the art tech in cheap phones. It's not QCs fault that Apple only makes extremely expensive phones.

I guess the reason no one else is complaining is that all other manufacturers have a diverse portfolio of products ranging from dead cheap to expensive and dead cheap is where the volume's at.

If Apples gets their way, QC will have to raise the price significantly on the chip as it will include the software license and considering the R&D costs they put into their technology, that will still be considered FR. That would mean that small manufacturers with only cheap phones and small margins will be pushed out of business as they will not be able to afford to use QC tech in their products.

This is not Apple being on the side of the consumer to get lower prices on parts and pass on those savings onto their customers, oh no. They see a possibility to both widen their margin while at the same time get rid of competition.
 

tongxinshe

macrumors 65816
Feb 24, 2008
1,035
604
Intel can't build modems without paying Qualcomm.
[doublepost=1498058824][/doublepost]

Apple doesn't make touch sensors. They didn't invent the technology.

That's why Apple also needs to pay royalties to the company who invented this technology, and a list of other important technologies that make the whole smartphone idea possible. Or at least, Apple trades their own royalty rights with some of these companies.
With smartphones cramming so many important technologies together, if all of them collect royalties in the same way as Qualcomm, the whole smartphone idea has to die, because it bounds to negative profit.
 

Glideslope

macrumors 604
Dec 7, 2007
7,401
4,755
The Adirondacks.
Apple likely sat on this while QCOM has been the sole source for cellular modems. Now that AAPL sources modems from INTC, it has some leverage. The question is if this is an indication AAPL will sole source modems from INTC for future products, including CDMA modems. Even if the QCOM modems have 1% better LTE performance, who give a **** since the INTC modems are capable of 1 Gbps and the carriers can't support it yet anyway.

The 7560 supports LTE, GSM, CDMA, and TD-SCDMA (China) in one package. This allows AAPL to have a single SKU world wide, including China. This coupled with eSIM would significantly reduce manufacturing, distribution, and inventory complexity.

https://www.intel.com/content/www/us/en/wireless-products/mobile-communications/xmm-7560-brief.html


View attachment 705033

Time to short QCOM and buy INTC!

You're a very astute individual. ;)
[doublepost=1498073879][/doublepost]
The basis of Standards Essential Patents is that you HAVE to license them because they’re part of the standard. That’s why Qualcomm is being sued by certain governments, because they’re using Standards Essential Patents as weapons.

Yes, let's all not forget that Apple is only one of several similar suits against Qualcomm. QC has in a put themselves in this corner. :apple:
 

tongxinshe

macrumors 65816
Feb 24, 2008
1,035
604
While I do understand the difference between a FRAND issue and the voluntary use of the App Store, this is somewhat analogous to the 30% "Apple Tax" on payments for digital goods made through an app. If I buy a subscription to Microsoft Office or another vendor offering a digital good Apple is going to take its 30% vig based on the value of what I'm buying from the other company, not what Apple is contributing. Apple is essentially saying the same thing Qualcomm is, "The simple fact we facilitate the service is what makes the end product valuable. If it wasn't for us you couldn't do all the great things you do and we deserve to be compensated based on your revenue stream."

Apple is being hypocritical.

Apple gets 15% of the recurring subscription charges, but 30% of the one-time purchase charges.
 
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