Qualcomm versus US FTC 'no license, no chips' antitrust trial wraps up

The United States Federal Trade Commission and Qualcomm have both presented closing arguments over the contentious 'no license no chips' policy — and the ultimate ruling will alter the trajectory of Apple's legal battle with the chip manufacturer.

The trial arguments that have taken the better part of January concluded on Tuesday, ahead of schedule. Closing arguments from both the Federal Trade Commission's battery of attorneys, versus Qualcomm's array were heard.

"The evidence is overwhelming that Qualcomm engaged in exclusionary conduct," said FTC lawyer Jennifer Milici. "The effects of Qualcomm's conduct, when considered together, are anticompetitive."

For it's part, Qualcomm defended the "no license no chips" policy not by asserting its legality, but instead claiming that there was no proof that it had hurt device manufacturers at all. Frequent spokesperson for Qualcomm, and head attorney Robert Van Nest led the closing arguments.

Judge Lucy Koh heard the case, and expressed her characteristic exasperation with both parties during the trial, as she did during the Apple versus Samsung matters. She warned that given the complexity and the stakes, that her decision would take longer than normal, according to the Wall Street Journal.

The FTC's lawsuit dates back to 2017, and accuses Qualcomm of antitrust violations by forcing chip buyers to sign patent licenses at inflated rates. The Commission rested its case on January 16.

Qualcomm has defended its practices by a number of means, for example pointing to the high cost of innovation. Apple has called the chipmaker's demands "onerous," at one point asking Apple to cross-license all of its intellectual property to get a direct license for standards-essential patents, something it decided to eschew.

Apple's Chief Operating Officer Jeff Williams recently revealed that Apple wanted to return to a mix of Intel and Qualcomm modems for 2018 iPhones, but was shot down by Qualcomm CEO Steve Mollenkopf. The two companies have been engaged in a global legal war since 2017, instigated by Apple, which sued over nearly $1 billion in rebates allegedly withheld as retaliation for cooperation with antitrust investigators.

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8 Comments

melgross 33607 comments · 20 Years

About 5 years ago

Since we don’t know what the ruling will be, it MIGHT alter the trajectory. We hope it will.

Fatman 513 comments · 8 Years

Apple must have a solid case to take it this far. Qualcomm currently has the best technology out there. We can only hope that after the smoke clears, Apple will again use Qualcomm chips until Intel (or Apple itself) has technology on par with Qualcomm's offering to enable them to ditch them completely without being at a disadvantage.

gatorguy 24607 comments · 13 Years

Fatman said:

Apple must have a solid case to take it this far. Qualcomm currently has the best technology out there. We can only hope that after the smoke clears, Apple will again use Qualcomm chips until Intel (or Apple itself) has technology on par with Qualcomm's offering to enable them to ditch them completely without being at a disadvantage.

I suspect that's what this has been about all along, Apple planning their own chipset instead of using either Qualcomm or Intel.

When Apple testified in the FTC trial that they were only paying QC $7.50 in royalties per handset (everyone was assuming it was waaay more than that) it did seem it might be less about the money and more about the freedom to go it alone without shackles.

gatorguy said:

Fatman said:

Apple must have a solid case to take it this far. Qualcomm currently has the best technology out there. We can only hope that after the smoke clears, Apple will again use Qualcomm chips until Intel (or Apple itself) has technology on par with Qualcomm's offering to enable them to ditch them completely without being at a disadvantage.

I suspect that's what this has been about all along, Apple planning their own chipset instead of using either Qualcomm or Intel.

When Apple testified in the FTC trial that they were only paying QC $7.50 in royalties per handset (everyone was assuming it was waaay more than that) it did seem it might be less about the money and more about the freedom to go it alone without shackles.

It was about the fact that Qualcomm wanted to double that fee, in addition to Apple paying for the chips. We read that testimony here a couple of weeks ago, I think it was.

melgross said:

gatorguy said:

Fatman said:

Apple must have a solid case to take it this far. Qualcomm currently has the best technology out there. We can only hope that after the smoke clears, Apple will again use Qualcomm chips until Intel (or Apple itself) has technology on par with Qualcomm's offering to enable them to ditch them completely without being at a disadvantage.

I suspect that's what this has been about all along, Apple planning their own chipset instead of using either Qualcomm or Intel.

When Apple testified in the FTC trial that they were only paying QC $7.50 in royalties per handset (everyone was assuming it was waaay more than that) it did seem it might be less about the money and more about the freedom to go it alone without shackles.

It was about the fact that Qualcomm wanted to double that fee, in addition to Apple paying for the chips. We read that testimony here a couple of weeks ago, I think it was.

Yeah. I don't know about that Mel. I think the $7.50 is what Apple and Qualcomm agreed on (yes Apple is still buying some Qualcomm wifi chips for older model iPhones) assuming the testimony was accurately reported.