As for Apple, its billions bought the company a six-year global patent licensing deal with Qualcomm, with the possibility of extending it another two years later, ending legal disputes with the chip company worldwide, and attracting Qualcomm`s services as a supplier of spare parts for future devices. That`s critical for Apple, because with Intel`s withdrawal from the 5G modem market for phones, Qualcomm is essentially the only game in town — until Apple doesn`t start producing its own. Qualcomm and Apple® today announced an agreement to dismiss all disputes between the two companies worldwide. The transaction includes a payment from Apple to Qualcomm. The companies have also entered into a six-year licensing agreement with effect from April 1, 2019, including a two-year renewal option and a multi-year chip supply agreement. In January 2017, Apple filed a lawsuit against Qualcomm, claiming that the chipmaker had withheld about $1 billion in royalties from Apple, in retaliation for cooperation with South Korean antitrust investigations, as well as allegations of blackmail, monopolistic practices and price cartels. In the complaint, Apple claimed that Qualcomm has committed to “charging Apple at least five times more payments than all other mobile patent givers with whom we have agreements.” Qualcomm published Tuesday morning on its investor relations site a slide containing additional information about these agreements and other related cases, before the announcement of the agreement, Apple had presented its opening arguments to the court. Apple has drawn parallels with Qualcomm`s “no license, no chips” business model, similar to a Kentucky Fried Chicken restaurant that didn`t sell food to its customers before customers bought a license to eat. The companies, one of the iPhone makers and the other the largest provider of mobile chips, said they had agreed to dismiss all disputes between them around the world. They added that they had reached a six-year agreement for Apple to pay unspecified royalties for Qualcomm`s patents. The agreement provides for a comprehensive patent licensing agreement and a chip supply agreement. “We are also pleased to have multi-year agreements with Apple and look forward to continuing to support them as customers,” said Steve Mollenkopf, CEO of Qualcomm.
The specific terms of the agreement have not been published, with the exception of the payment of a certain amount and a license agreement from Apple for a period of six or eight years. Neither Apple nor Qualcomm have yet made a statement on the subject, going beyond the press release. Qualcomm`s new complaint is an amendment to the complaint filed against Apple in November 2017. Qualcomm said the newly uncovered facts lead to additional charges against the iPhone maker, including usurping trade secrets and violating the agreement. The deal ends all ongoing litigation, including with Apple`s companies that have entered into a global patent licensing agreement and a chip delivery agreement At the heart of the disputes, there was disagreement over how Qualcomm collects royalties on patents it holds on mobile chips. Based in San Diego, the company had pioneered in the 1990s in a type of mobile communications, which later became a pillar carrying mobile devices. This has made it possible to charge royalties for almost every smartphone sold – even though the phone doesn`t use Qualcomm chips….