What does Capitalism have to do with this?
Not saying I've got a better idea than capitalism, but I wouldn't consider it ideal.
Patents are a good idea, it's the current implementation that sucks
"When the competition starts using your own improvements/innovations against your products, and they are not moving a single finger to push innovation, you are obliged to keep the secret."
I don't mind if the competition improves my work, this is more than enough incentive to push innovation forward, but when the competition stalls and makes a verbatim implementation of my work, or worse enough, depends solely on my improvements to stay relevant, I honestly prefer to keep the secret to myself. I don't want parasite competitors, I want talented competitors.
What you describe also occurred/occurs in Cuba, and that's not a capitalistic regime.
I think it's pretty tricky to consider that a real 'effect', as if the alternative companies kept secrets then it would be just as bad.
But most of the population is uneducated in that regard. Blame the lack of enthusiasm for FOSS.
Do you morally and ethically agree with the position that Qualcomm should get paid a licence fee for the firmware for each and every resale of a particular chip? (vs the spirit of the first sale doctrine)
At the moment, it seems that you're giving tacit approval to this position.
I think it's reasonable to sell the chips under a restricted license - you don't expect people to use the chip in a product you don't know about. Consider a metaphor using a collection of short stories. You include your story in an anthology, which lets the buyer re-sell it at will. However, it would be questionable for the buyer to remove your story, and re-bind it as part of another book, which they then sell.
These actions are not restricting the actions of customers in any way (as far as I know), so they seem ok to me.
Edit: sorry about the delay in reply!
But they would be thwarted by license agreements making the drivers generally nonredistributable?
I suspect there are a lot of professional Engineers working on products that will ship fewer than 10M units. Sometimes these Engineers then go on to design products that ship more than 10M units and prefer to keep working with the chips they know. Sometimes those Engineers are 'hobbyists' too.
Modern SoCs demand thousands of pages to cover all available features and possible applications, and putting together that documentation in a self-consistent way is a challenge. Some vendors have decided that supporting low-revenue clients is not worth the cost of putting together said general-purpose documentation and providing support to each and every buyer. They'd rather not sell you the product in the first place than sell you something and stiff you on documentation & support, which is a reasonable position.
Often when you're a low-quantity company you deal with low-quantity vendors who are willing to support you. When you move to high volume you might prefer to keep working with the chips you know. But when your operations guy comes back to you and says that the Big Co (who wouldn't talk to you in the past) can sell you chips for $5 less, that's $50M you just saved (given your 10M unit quantity). So you switch. In this example you have two different vendors: high cost / high support, low cost / "exclusive" support. Both have markets, just different ones.
TI is an example of a vendor that is very hobbyist / small quantity friendly. Even that wasn't enough to save them - they've pulled out of the phone SoC business.