$1.8 billion retroactive payment! Qualcomm and Huawei reach a settlement
$1.8 billion retroactive payment! Qualcomm and Huawei reach a settlement

On July 30, Qualcomm released its financial report for the third quarter of the fiscal year 2020, which revealed a lot of information previously unknown to the outside world. In addition, Qualcomm announced that it had reached a patent settlement with Huawei, and had settled the minor licensing dispute with Huawei, and Huawei would make up $1.8 billion in retroactive payments.

The financial report just released shows that Qualcomm's revenue in the third fiscal quarter was $4.893 billion ($9.635 billion in the same period last year), and its net profit was $845 million, down 61% year on year ($2.149 billion in the same period last year). It seems to be a serious setback, but in fact, the previous figure is on the high side (for example, Apple's $4.5 billion settlement fee last year). In addition, Qualcomm's performance outlook for the fourth fiscal quarter also exceeded analysts' expectations, leading to a sharp rise of more than 12% in Qualcomm's share price after hours.


According to the previous data, Huawei and Qualcomm signed a temporary patent fee agreement on December 30, 2018. Huawei will increase the patent fee from $100 million to $150 million every quarter for three consecutive quarters. Huawei and Qualcomm had a long negotiation, and the final result was a $1.8 billion retroactive payment. Huawei is still prohibited from purchasing Qualcomm chips, but has resumed paying licensing fees for wireless technology.



Apple, another mobile phone giant, had a legal dispute with Qualcomm in 2017, and then used Intel baseband in a large scale. Finally, the two sides settled on April 16, 2019, and the "settlement fee" was up to 4.5 billion US dollars (up to 4.7 billion US dollars). Apple pays a one-time patent licensing fee to Qualcomm, and Qualcomm transfers chips and technology licenses to Apple. Although the total amount of cash and securities in Apple's hands at that time exceeded $225 billion, $4.5 billion was not a small amount.

As for many "old war wolves" who said that they would impose sanctions on Qualcomm, in fact, it is not enough (nor realistic). After all, Qualcomm is a famous patent "boxer". It has not only quarreled with Huawei, but also with Apple, a "man of its own". It has just reconciled with LG. Compared with Apple's $4.5 billion, Huawei's $1.8 billion does not sound like a lot (it will be more comfortable to cheat yourself).

In addition, Qualcomm made great efforts to develop the network in those years, and the patent fee system is still just (but it is too hard to collect). The boundary of things should be clearly defined. One yard counts for one yard. There are wrongs, debts and owners. Not everything should rise to such a high level.

This story tells us again that knowledge is dollars. Now there is an incentive for 2/3G to withdraw from the network as soon as possible. With so many patent fees paid by different companies every year, is it not delicious to save money to buy chili sauce


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