Qualcomm and Apple’s years-long legal dispute over patent practices and royalties has now been brought to a sudden stop, Bloomberg reports, following a settlement agreement between the tech giants being reached.
The deal between the two companies means that both companies will be ending all litigation processes on a global scale but also reportedly includes some perks for Qualcomm. Apple will be compensating the chipset manufacturer an unspecified sum as part of a six-year agreement that goes into effect as of the first of this month.
Licensing isn’t the only inclusion in the agreement either. Apple will retain the option to extend the deal by two years and a chipset supply agreement that will span several years.
The change in the case is in stark contrast to claims the iPhone maker has previously made regarding what it has referred to as Qualcomm’s “unfair” licensing terms. Those include charging partners royalties for the overall cost of a device shipped using the latter company’s components.
That practice has previously landed Qualcomm in hot water with other companies over the past several months and years with accusations ranging from anti-competitive practices to double-charging licensing. Qualcomm has historically been able to settle a large number of those disputes but has lost ground in areas where patents were deemed essential to the industry — forcing it to license its inventions to competitors.
The two companies have sparred over accusations of patent infringement and lapsed payments, with both tech giant’s taking the gloves off in early 2017.
Sudden but not entirely unexpected because 5G
Although the new agreement between Apple and Qualcomm came abruptly within the context of how virulent the litigation had become on both sides, it didn’t necessarily come without warning. Whether by luck or otherwise, industry insiders have been predicting that a deal would likely be reached since as recently as August of last year. The unnamed sources also suggested that the resulting agreement would end all litigation and that both companies would drop their ongoing cases.
The expectations were, in part, pinned on Apple’s need to continue pushing out new handsets for iPhone users who don’t have the luxury of simply switching OEMs and maintaining the same experience. It also came down to necessity in terms of keeping up with Android, to begin with.
Summarily, Qualcomm is a company that has formed partnerships and alliances with other component makers, ensuring that it has effectively cornered the 5G segment of the industry. If Apple hopes to release its first 5G-enhanced iPhone alongside the biggest names — and its biggest threat — in Android, it is going to be reliant to some extent on Qualcomm irrespective of which company it partners with.
It’s all in the non-existent details
Specifics about the deal that’s been reached by the companies are predictably slim on the ground for the time being, likely due to final considerations and proceedings to cement the agreement. So not only have no financial reparations not been divulged. There’s also no way to determine with any certainty whether 5G hardware and modems or some other factor played a central role in paving the way for the stand-off to come to an end.