[HN Gopher] Qualcomm shook down the cell phone industry for almo...
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Qualcomm shook down the cell phone industry for almost 20 years
(2019)
Author : ddtaylor
Score : 92 points
Date : 2022-05-30 10:10 UTC (2 days ago)
(HTM) web link (arstechnica.com)
(TXT) w3m dump (arstechnica.com)
| bsder wrote:
| As much as I really loathe Qualcomm, they placed an _enormous_
| existential bet on QAM and that they could make the linearity
| requirements work.
|
| For a long time, the power amps to make that work had an
| absolutely _abysmal_ yield and only a single company (Rockwell
| Defense) could fab them.
|
| The company walked a tightrope and could very well have died.
| This is the kind of tech advancement that _absolutely_ deserves
| some level of patent protection.
|
| The fact that the patent system allows this to be parlayed into a
| multi-decade shakedown is different from whether Qualcomm should
| have been granted patents initially.
| xoa wrote:
| I think the basic problem was in their abuse of the standards
| process. Having patents on your own inventions for a limited
| time, for hardware at least [0], has strong arguments. But it
| doesn't typically exempt one from general antitrust law as far
| as colluding with others to corner a market. On the other hand,
| there is an unavoidable natural physical limitation when it
| comes to the viable electromagnetic spectrum, and huge win/wins
| all around in everyone being standardized across carriers and
| devices for how they communicate.
|
| The spirit of the SEP process was supposed to be essentially a
| quid pro quo: everyone can volunteer to join and then have
| their IP used in a way that would normally be illegal (all
| players leveraging various government granted or built
| monopolies to essentially force the entire world to use and pay
| for certain IP), and thus get a massively larger market for
| their products, but in exchange have to give up the normal full
| levels of control a patent would afford by offering RAND terms
| to all on the value of those specific contributions. It's a bet
| that more money can be made from a guaranteed smaller cut on
| billions of devices vs a large cut on ones own vertical stuff
| (and possibly being frozen out of usage in certain markets
| entirely).
|
| Qualcomm though leveraged that to extract a % of everything
| else in the device too using this multi-level monopoly. That
| wasn't OK. If from the very beginning they'd wanted to just
| demand everyone else not use any of their patents except by
| specific licensing with them, no inclusion in any standards,
| that'd be honest enough. Or if they'd gone the other way and
| full RAND that too. But they wanted to have their cake and eat
| it and that should have been stomped on by regulators right off
| frankly.
|
| ----
|
| 0: I don't think software patents should exist at all because
| the core investment of software is more than adequately
| protected by copyright.
| sydthrowaway wrote:
| What's the next future in modulation schemes?
| femto wrote:
| Massive MIMO. Arguably a modulation scheme if the array of
| antennas is treated as a whole.
| stefan_ wrote:
| Sure, and you should get some money for your tech in that
| cellphone chip. But that doesn't mean you should be able to
| extort some % of a car just because it's got the chip in it.
| stevenjgarner wrote:
| Anybody want to summarize the "scathing 233-page opinion" how
| Qualcomm's patent licensing "violated American antitrust law".
| This article basically explains how Qualcomm was intelligent
| about protecting their proprietary position. It does not seem to
| explain how that protection was illegal.
| stevenjgarner wrote:
| This article definitely does not hit the nail on the head.
| Patent holders regularly supply patented technology through a
| patent license agreement. What exactly was discriminatory and
| not in good faith about the way Qualcomm did it? INHO, a legal
| ruling this monumental should be way easier to understand for
| those of us who routinely supply and license proprietary
| technology. The article does not summarize or explain the
| actual court's findings:
|
| The Court orders the following injunctive relief:
|
| (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.
| yonran wrote:
| I think the crux of the article is this: they used the
| protected monopoly on one market (e.g. CDMA modems) to gain an
| unfair advantage in the other markets (all the other chips in a
| cell phone).
|
| > Qualcomm's patent licensing fees were calculated based on the
| value of the entire phone, not just the value of chips that
| embodied Qualcomm's patented technology. This effectively meant
| that Qualcomm got a cut of every component of a smartphone--
| most of which had nothing to do with Qualcomm's cellular
| patents.
| radicaldreamer wrote:
| Do competitors or manufacturers using other vendors (Huawei,
| Samsung, Mediatek, Apple) have to pay Qualcomm licensing
| fees?
| noselasd wrote:
| Absolutely
| paxys wrote:
| When I worked at Qualcomm a while ago the company had two major
| business lines. One of them was developing and selling a line of
| mobile chipsets (Snapdragon) to a lot of the major players in the
| market, for which they employed thousands of top engineers and
| researchers. The other was licensing their CDMA patents to _all_
| of the players in the market, and this org was run entirely by
| lawyers. The second business made _significantly_ more money than
| the first.
| dang wrote:
| Discussed at the time (of the article):
|
| _How Qualcomm shook down the cell phone industry for almost 20
| years_ - https://news.ycombinator.com/item?id=20055517 - May 2019
| (300 comments)
| thomasjudge wrote:
| What is the point of resubmitting this article now?
| bogwog wrote:
| Who could've predicted that patents, legal instruments designed
| to create monopolies, would be used to create monopolies?
|
| EDIT: Apparently, Qualcomm won the appeal[1]. I wonder if the
| situation is still as bad today as it was when this article came
| out?
|
| https://www.qualcomm.com/content/dam/qcomm-martech/dm-assets...
| jjoonathan wrote:
| Probably the same people who gave the USPTO a profit motive to
| issue patents, no matter how absurd.
|
| (Well, not "profit" in the sense of having shareholders and
| dividends, but definitely in the sense that its budget comes
| from fees and it gets more fees if it issues more patents.)
| josaka wrote:
| This ruling did not survive on appeal:
| https://scholar.google.com/scholar_case?case=542088572460013...
| rektide wrote:
| Which feels insane. It feels like there's no constraints, no
| restrictions on what's allowed to keep down competition.
| lazide wrote:
| Patents are time limited, then go into the public domain for
| this reason.
| hedora wrote:
| The USPTO makes it easy to re-patent things after
| expiration.
| paulryanrogers wrote:
| Technically doesn't it require some new innovation? And
| the original patent itself still enters the public
| domain?
| rektide wrote:
| A vast part of problem is that the people deciding aren't
| adequately technical, can't judge the non-obvious clause
| adequately.
|
| Making up some faint new claim, that so happens to
| largely encompasses the existing claim, feels all too
| regular. There's just so few people fit to judge, to
| appropriately decide to award or not award another decade
| or so of monopoly to a patent.
| wmf wrote:
| Enjoy your EDGE phone.
| rektide wrote:
| 20 years of complete & total control of an industry is way
| way way too long. If we're going to allow what Qualcomm
| did, it should be 5 years, absolute tops, probably less.
|
| This is just so proper fucked, such a messed up
| manipulation. And I agree- it does look legal. The law
| debases itself, delegitimizes itself, brings shame to
| itself by permitting this unbelievable horseshit. Which, as
| others elsewhere have pointed out, is what was allowed:
| this ruling got appealed & overturned. Qualcomm got away
| with being a tyrant & ruining an industry.
| mtgx wrote:
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