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> First, Apple is known to squeeze every penny from their suppliers to improve their bottom line.

This is just unequivocally false. I used to work for a semiconductor company that was a supplier for Apple. Apple would pay a premium compared to other companies.

The semiconductor game is kind of rigged, assuming you don't have your own fab, everyone knows your costs. They know how much a wafer costs and they know the size of your device, so they have a pretty good idea of what it costs you per device (they don't know your yield, but can guess a range).

Everyone uses that information to keep your profit margins fairly low. Apple would pay a premium compared to other manufacturers. You could probably look at the financial reports of various apple suppliers and reverse engineer that information.

Apple is extremely risk averse, them making their own modems is almost certainly about reducing supply chain risk.

Profit margins will be lower down on the priority list. They can just increase the price of the phone to improve those.

For the record, I am not an Apple fan, I disliked working for one of their suppliers and dislike their products. But they do pay their suppliers a premium.

Some suppliers are paid a premium. Some get absolutely squeezed. Just depends. I'm glad you were on the premium side.

> Third, Apple's legal argument was always that Qualcomm's per-device (ie, final product) royalty basis licensing offer was not FRAND. Apple believes that the royalty should be based on the cost of Qualcomm's chips instead. But, of course, there is no legal basis or industry practice to support Apple's unfounded claim and, consequently, LOST EVERY lawsuit based on this claim for past 10+ years.

Did you check FTC v Qualcomm antitrust case? Can you stop your lies?

>> Did you check FTC v Qualcomm antitrust case? Can you stop your lies?

Sure, isn't that the case Qualcomm reversed and won? Sure, most legal analysts had expected Apple's sweetheart judge Lucy Koh to hand a victory to FTC as it was no coincidence how the case ended up on her desk in the first place. This was however unanimously reversed due to its flawed constrution of Qualcomm's monopoly in premium LTE market and Judge Koh's expansive interpretation (in favor of Apple/FTC).

But wrt Apple's claim on royalty basis? Not so much.

>>Can you stop your lies?

When are you going to stop spreading misinformation?

> Apple believes that the royalty should be based on the cost of Qualcomm's chips instead

Sounds great. Apple should also base their app store tax on the cost of hosting.

Solid response.

You know, you can disagree without including the insulting language. That will lead to more and better discussion.

There's nothing seriously insulting in that post. Calling out biased Apple defenders for their misleading claims isn't an insult no matter how much some would want it.

> Apple's legal argument was always that Qualcomm's per-device (ie, final product) royalty basis licensing offer was not FRAND. Apple believes that the royalty should be based on the cost of Qualcomm's chips instead. But, of course, there is no legal basis or industry practice to support Apple's unfounded claim and, consequently, LOST EVERY lawsuit based on this claim for past 10+ years.

Qualcomm demanded a percentage of the retail selling price of phones using it's modems.

Similarly, Google bought Motorola for it's patent portfolio and famously lost a lawsuit against Microsoft after demanding a 2.5% cut of the retail cost of Microsoft hardware (estimated to be about 4 Billion dollars a year) using it's standards essential patents.

> Motorola sent a letter to Microsoft asking it to pay as much as $4 billion per year to license patents relating to the 802.11 standard that underpins Wi-Fi and the H.264 video encoding standard.

https://www.computerworld.com/article/2955773/microsoft-best...

Google lost the case and the appeal, and the courts imposed a flat 3 million dollar per year licensing fee instead of the ~4 Billion a year that Google demanded.

https://www.vox.com/2015/7/30/11615248/google-loses-bid-to-o...

So, this is hardly an unfounded claim.

>> " ... Qualcomm demanded a percentage of the retail selling price of phones using it's modems. ..."

No, that's not how it works. Apple does NOT have licensing agreement with Qualcomm. Apple's contract manufacturer, or CM's -- such as Foxconn -- are the primary licensees of Qualcomm's wireless portfolio. Apple's royalty -- or indirect payment to Qualcomm via CM's -- likewise is based on Foxconn's pre-existing licensing agreement with Qualcomm (which even predates Apple's first iPhone) and on Foxconn's manufacturing/wholesale price, which is typically 1/3 or 1/4 of Apple's retail price (often under $400 -- not surprisingly Qualcomm's licensing fee maxes out at $400).

>> Similarly, ... ( using it's standards essential patents. ... So, this is hardly an unfounded claim.

The Motorola case does not support Apple's royalty-basis theory at all, First, Judge Robart does not invalidate end-user device as royalty-basis, or favors SSPPU promoted by Apple. Second, his decision was based on two critical considerations: merits/value contribution/significance of the patents asserted against Microsoft. And, in order to determine an appropriate price/range, if there existed any comparable RAND licensing practice adapted by other patent holders in the industry. In Motorola's case, their patents were relatively frivolous and insignificant in value/merit contributed, and their royalty rates were simply out of whack -- certainly 1000x out of common industry practice in the video encoding/802.11 wireless business.

Qualcomm is an industry pioneer with numerous seminal contribution under their belt. Their licensing practice also conforms with long-held de facto industry practices; though there are some aspects of their licensing business that are bit quite anticompetitive -- royalty-basis is not among them however.

> No, that's not how it works.

No, that's exactly what Qualcomm demanded. The fact that they have changed their demands over time after various court losses does not change the past.

>>No, that's exactly what Qualcomm demanded. The fact that they have changed their demands over time after various court losses does not change the past.

Sure, that's a fig of your imagination. You simply don't know how Qualcomm's, or the industry's, licensing model works. I also suspect that you didn't even bother to read the court case you cited, the Motorola case.

Let me just say again for one last time: Apple lost or settled every lawsuit involving wireless patent royalty basis claim. If Apple ever prevailed in one case cracking the industry's per-device royalty-basis model, they wouldn't have bought Intel's failing wireless business out of desperation after losing the last legal battle with Qualcomm in 2019, which Apple settled just one day after the trial started.

Let's just admit it. Now that the cellular industry in the States has transitioned past 3G, Qualcomm no longer has patents that are required for compatibility, but are not bound by commitments to license under FRAND terms.

The Google/Motorola/Microsoft case (and associated FTC order) shows that Qualcomm will not be able to pull the same price gouging shenanigans with patents that are encumbered by requirements to license under FRAND terms.

The standards essential 4G/5G patents are all encumbered by requirements to license to all comers on FRAND terms.

Which means Qualcomm is severely overvalued now that anyone with the means will be able to develop their own modems without anticompetitive interference. How long until Samsung starts selling their own in-house modem to others?

>> The Google/Motorola/Microsoft case (and associated FTC order) shows that Qualcomm will not be able to pull the same price gouging shenanigans with patents that are encumbered by requirements to license under FRAND terms.

sigh. Again you are throwing around court cases that don't support Apple or your claim. The Motorola case isn't nearly "associated" in anyway to the FTC case. Further, the FTC case was reversed in an unanimous decision -- due to its flawed construction of Qualcomm's monopoly in premium LTE segment and Apple's sweetheart judge Lucy Koh's overly expansive intrepretation of the antitrust law. The FTC's case is all, but dead and there would be no further legal challenge -- no SCOTUS justice is going to put up with a deceptive kabuki threater concocted by Apple and their Democratic operatives at FTC.

>> The standards essential 4G/5G patents are all encumbered by requirements to license to all comers on FRAND terms.

Qualcomm's licensing terms are FRAND -- just because Tim Apple doesn't like it doesn't mean that it's not FRAND. It's not about Tim Apple's feeling or Apple's margin, but rather about reasonable, acceptable industry licensing practices.

If you can't be bothered to stick to factual arguments, I really can't be bothered to care about your opinions.

Sure, just b/c you haven't actually read anything you cited, simply don't understand how licensing/indusry works, doesn't mean that my arguements aren't factual. Thank you for playing.

Please disclose if you're invested in Qualcomm in any way.

Please disclose if you're invested in Apple in any way.