Qualcomm’s fight with the US Federal Trade Commission starts

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Reuters reported that the antitrust case in which Qualcomm is accused of abusing a monopoly on mobile chip technology kicked off this Friday in California. If Qualcomm loses the case, it will be forced to change its business model regarding licensing of its crucial patents. This could affect the smartphone future.

Opening arguments were made in the court on January 4th. It is a 10 day trial with no jury. Judge Lucy Koh (of the famous Apple Vs Samsung case) will preside over this case.

Qualcomm researches in processors and other technologies used in mobile devices. It has nearly 220,060 granted patents and published patent applications worldwide. Qualcomm licenses its technologies to many companies and earns a good chunk of its revenue through it.

The FTC lawsuit filed in 2017 accuses Qualcomm of practicing “no license, no chips” policy. This policy made Qualcomm’s customers pay high royalties and it weakened competition. The FTC in its complaint said that Qualcomm refuses to license standard essential patents under fair terms. The FTC also said that Apple was forced by Qualcomm to pay royalties for its patents in exchange for using its chips in its phones.

After three days of FTC’s complaint, Apple filed a lawsuit against Qualcomm accusing it of not giving fair licensing terms for its chip technology. So, the outcome of FTC Vs. Qualcomm case is crucial for Apple.

Both Samsung and Intel have filed amicus briefs supporting the FTC in the case. Qualcomm also has anti-trust cases against it in the EU, South Korea and Taiwan.

Meanwhile, Qualcomm enabled the injunction issued by the district court of Munich ceasing the sale of iPhone 7 and iPhone 8 to be enforced. Qualcomm paid bonds of €1.34 billion for the enforcement to happen. This means, Apple cannot sell its iPhone 7 and iPhone 8 in Germany.

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