After years of dancing around one another, the monumental legal fight between Apple and Qualcomm final came to a head on Monday as the trial itself began. The culmination of over three years of planning and potentially billions of dollars of damages, this courtroom showdown was set to be the drama of the year, but before it's even really started, it's already over. Apple and Qualcomm have reached a settlement, dropping all ongoing litigation.
As part of the settlement, Apple has agreed to pay Qualcomm an undisclosed sum, entering into a six-year licensing agreement retroactively effective to April 1st, 2019, with a two-year extension option and a "multiyear" chipset supply agreement. That could mean Intel modems won't make it into future Apple devices — paired with Samsung's announcement today of 5nm lithography, I expect Intel's stock will take a solid beating in the coming hours/days.
The precise motivations behind the last-minute settlement are unknown, but odds are that the industry-wide move to 5G played a role. Qualcomm was, realistically speaking, Apple's only choice for modems if it wanted to be part of the 5G party before all the seats were taken. After all, Qualcomm has hardware that's ready, waiting, and fully compatible with the upcoming standards — in devices that are working today, right now — while Intel's still just showing off demos at tradeshows in the hopes consumers might see its hardware land in devices sometime in 2020.
Qualcomm's stock is up substantially at the news.
Whatever the reason behind the settlement, the years-long drama between Apple and Qualcomm is resolved, at least for now. The full press release (which includes almost no details) is just below.
PRESS RELEASE
Qualcomm and Apple Agree to Drop All Litigation
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Agreement ends all ongoing litigation, including with Apple’s contract manufacturers
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Companies have reached a global patent license agreement and a chipset supply agreement
April 16, 2019 03:04 PM Eastern Daylight Time
SAN DIEGO & CUPERTINO, Calif.--(BUSINESS WIRE)--Qualcomm and Apple® today announced an agreement to dismiss all litigation between the two companies worldwide. The settlement includes a payment from Apple to Qualcomm. The companies also have reached a six-year license agreement, effective as of April 1, 2019, including a two-year option to extend, and a multiyear chipset supply agreement.
Apple revolutionized personal technology with the introduction of the Macintosh in 1984. Today, Apple leads the world in innovation with iPhone, iPad, Mac, Apple Watch and Apple TV. Apple’s four software platforms — iOS, macOS, watchOS and tvOS — provide seamless experiences across all Apple devices and empower people with breakthrough services including the App Store, Apple Music, Apple Pay and iCloud. Apple’s more than 100,000 employees are dedicated to making the best products on earth, and to leaving the world better than we found it.
Qualcomm invents breakthrough technologies that transform how the world connects, computes and communicates. When we connected the phone to the Internet, the mobile revolution was born. Today, our inventions are the foundation for life-changing products, experiences, and industries. As we lead the world to 5G, we envision this next big change in cellular technology spurring a new era of intelligent, connected devices and enabling new opportunities in connected cars, remote delivery of health care services, and the IoT — including smart cities, smart homes, and wearables. Qualcomm Incorporated includes our licensing business, QTL, and the vast majority of our patent portfolio. Qualcomm Technologies, Inc., a subsidiary of Qualcomm Incorporated, operates, along with its subsidiaries, all of our engineering, research and development functions, and all of our products and services businesses, including, the QCT semiconductor business. For more information, visit Qualcomm’s website, OnQ blog, Twitter and Facebook pages.
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