Qualcomm and ARM at war? a licensing battle that could cripple the market for smartphones, tablets and Android devices

A legal battle between chip giant Qualcomm and the designer of the ARM architecture has escalated even during the week of the Qualcomm Snapdragon Summit this 2024, during which the issue was ignored.

What is going on between Arm and Qualcomm?

ARM has notified the San Diego, California-based U.S. multinational that it is terminating a key agreement that allows it to design its own chips based on ARM’s patent, Bloomberg News has learned.

What could happen in the event of this cancellation?

This decision could have a negative impact on the chip market as it comes in the midst of an ongoing lawsuit between the two companies. As a result, both companies’ stocks were hit by the news: Qualcomm shares lost about 4% of their value on Wednesday of last week, and Arm Holdings shares lost 6.6%.

What is the origin of the conflict?

The root of the problem lies in Qualcomm’s acquisition of Nuvia in 2021. ARM argues that Qualcomm should have renegotiated its license after that acquisition, since Nuvia had its own license with ARM. Qualcomm, for its part, argues that its existing agreement covers this acquisition and accuses ARM of making “unfounded threats” to increase its royalty rates.

The trial

The case will be heard in federal court in Delaware next December and, if ARM wins, could have serious implications for the microprocessor industry.

What can happen in case of an Arm victory?

Qualcomm and all its partners involved, including Microsoft, could be forced to stop selling products such as the new Copilot laptops, as well as devices with the new Snapdragon 8 Elite, such as smartphones, tablets and so on. This covers most of the new Android-powered devices that integrate the new portable platform.

What is interesting about this legal issue between Qualcomm and ARM is that it comes at a time when Intel and AMD have joined forces to form the X86 Advisory Group.

What does Qualcomm have to say about this?

When we asked Qualcomm representatives for their position on the matter, the communications agency sent us the following: “This is more of the same from ARM – more unfounded threats designed to strongarm a longtime partner, interfere with our performance-leading CPUs, and increase royalty rates regardless of the broad rights under our architecture license With a trial fast-approaching in December, Arm’s desperate ploy appears to be an attempt to disrupt the legal process, and its claim for termination is completely baseless. We are confident that Qualcomm’s rights under its agreement with Arm will be affirmed. Arm’s anticompetitive conduct will not be tolerated.”

Follow MeriStation USA on X (formerly known as Twitter). Your video game and entertainment website for all the news, updates, and breaking news from the world of video games, movies, series, manga, and anime. Previews, reviews, interviews, trailers, gameplay, podcasts and more. Follow us now!