The Qualcomm lawyers are building a reputation as the hardest working in the industry, though at least they no-longer have to battle the Taiwanese Fair Trade Commission.
The resolution of the dispute will come as a welcome relief, allowing the team to focus on other fronts against Apple, the European Commission and various, and the legal team have even saved Qualcomm quite a bit of cash. The deal reverses most of the $773 million fine, though it has agreed to up research commitments in the country.
“We are pleased to have reached a mutually beneficial resolution with the TFTC that puts the litigation behind us,” said Alex Rogers, President of Qualcomm Technology Licensing. “This settlement directly addresses concerns raised by the TFTC, regardless of disputed positions, and builds on our foundation of collaborative, long-term business relationships in Taiwan.
“We are happy to reaffirm our commitment to licensing our valuable intellectual property under principles of fairness and good faith. With the uncertainty removed, we can now focus on expanding our relationships that support the Taiwanese wireless industry and rapid adoption of 5G technology.”
As part of the agreement, Qualcomm will increase its research footprint in the country and has committed to spending $700 million over the next five years. In exchange, Qualcomm will stop getting fined and can continue to charge manufacturers royalties on its technology. The FTC will keep the $89 million Qualcomm has already paid, but will forget about the rest.
It will cost the chip giant cash in the long-term, but this is a minor price to pay in securing a future for its threatened licensing business. This was the major worry for investors, as it is a cash-cow, generating the majority of profits which few would want to see run dry. With Apple recruiting governments around the world in its battle against the licensing business model, this is a certainly a win for Qualcomm.
Qualcomm still faces various antitrust investigations around the world, building an expensive legal bill, but with Taiwan concluding the activities are not monopolistic or abusing market position, it is precedent which Qualcomm can point to.