Intel and Samsung have each joined the FTC’s lawsuit towards Qualcomm, accusing the smartphone SoC and wi-fi modem producer of partaking in practices that violate antitrust regulation. Honest disclosure requires me to notice that Intel’s temporary is not possible to learn with out chortling. Anybody who remembers AMD’s antitrust lawsuits towards Intel might have an analogous drawback, given Intel’s smug dismissal of AMD’s complaints on the time, in contrast with the outraged tone it takes in its personal court docket submitting towards Qualcomm.
In accordance with Intel, Qualcomm has:
[M]aintained an interlocking net of abusive patent and industrial practices that subverts competitors on the deserves. These practices have coerced mobile-phone producers (also referred to as “unique gear producers” or “OEMs”) into buying the chipsets they want from Qualcomm and Qualcomm alone. The FTC’s detailed grievance paperwork the Qualcomm practices which have created that coercive enterprise local weather and stymied competitors. Qualcomm’s habits has inflicted and continues to inflict exactly the harms that the antitrust legal guidelines search to guard towards: hurt to the aggressive course of, to shopper welfare, and to innovation and progress.
Particularly, Intel argues that Qualcomm refuses to promote chipsets except producers buy patent licenses and conform to pay Qualcomm income on each chipset bought, whether or not that chipset incorporates Qualcomm processors or not. It additionally argues that Qualcomm refuses to license Customary Important Patents (SEPs) to its rivals, that it has organized an unique (and beneath market worth) take care of Apple to nook the market, and that Qualcomm has used a mixture of patent licensing and exclusivity offers to forestall the smartphone market from functioning as a free and impartial market.
Now, don’t get me flawed — Qualcomm might be discovered to have engaged in abusive habits, and I’m not saying in any other case. However for Intel to complain about Qualcomm’s licensing and royalty buildings after its personal abuses is solely magical. Keep in mind, Intel paid $1.2 billion to AMD to settle its antitrust case earlier than it went to trial and was fined $1.45 billion by the EU. Its largest associate in crime, Dell, paid $100 million to settle SEC charges that the corporate misrepresented the affect Intel’s predatory rebate practices had on the OEM’s backside line. Again then, Intel rebates had been so crucial to Dell earnings, that they had been the one method the corporate might meet its consensus EPS estimates each single quarter from 2002 by way of 2006. Within the first quarter of FY 2007, 76 % of Dell’s working revenue got here from Intel exclusivity funds — aka, Intel paying Dell to not use AMD merchandise.
It’s, due to this fact, hilarious that Intel would go to the FTC to declare its lack of ability to compete with Qualcomm.
Samsung backs up Intel’s claims
That stated, Samsung, Intel, and the FTC are making a cohesive set of claims about Qualcomm’s enterprise practices which will nicely get up in court docket. Each Samsung and Intel argue that Qualcomm refuses to license its patents to rivals, regardless of holding important patents which can be functionally required to construct an LTE modem (we’ve coated FRAND and SEP patent licensing in earlier tales on this topic). This might put Qualcomm in violation of the Sherman Act alone, since SEP licensing points have been beforehand discovered to set off such clauses. Samsung’s submitting is extra narrowly tailor-made than Intel’s, and focuses extra particularly on whether or not Qualcomm is required to license its patents to rivals beneath the foundations that govern SEP and FRAND licensing within the first place. Unsurprisingly, Qualcomm is arguing that it has no authorized requirement to license its patents.
It’s more durable to make goal determinations about whether or not corporations have complied with patent license necessities, in contrast with whether or not one firm’s merchandise are available on retailer cabinets. It makes this case fairly totally different from the sooner Intel-AMD lawsuit we alluded to (schadenfreude however). We’ve actually seen earlier than that Qualcomm confronted strong competitors in 2G and 3G modems, however dominated the 4G / LTE area to an unprecedented diploma. That has modified considerably, now that Intel, Samsung, and a handful of different corporations have their very own radios in-market. However Qualcomm had the market all however locked up for fairly a while. Qualcomm has requested that the swimsuit be dismissed, however the FTC has but to rule on that proposal.