Apple agrees to become Qualcomm's licensee and returns to their baseband chips

By: Maynard Handley (name99.delete@this.name99.org), April 19, 2019 11:49 am
Room: Moderated Discussions
Doug S (foo.delete@this.bar.bar) on April 18, 2019 9:45 pm wrote:
> Dummond D. Slow (mental.delete@this.protozoa.us) on April 18, 2019 4:47 pm wrote:
> > https://arstechnica.com/tech-policy/2019/04/qualcomm-shares-up-20-percent-after-apple-agrees-to-settlement/
> >
> > I was interested what will the enlightened people say about the Qualcomm-Cuppertino deal
> > so that us lowly mental protozoa know what to think about it, but still nothing, alas.
> >
> > So what is the impression from that?
> > Is it more Apple caving in its attempts to save a bit of the few dollars they
> > pay in licensing per phone (while they raise enduser's prices by much more...),
> > because the case didn't look good and neither did Intel's 5G modem?
> > Or did they win and forced Qualcomm to give them superbly special
> > prices, as they were afraid of what would happen at the court?
> > (Honest question btw.)
>
>
> No one knows for sure. There are always rumors and theory. I found the timing of the settlement really
> interesting - if it was Apple caving as some claim then why would they do it one day into the trial?
> Why not wait and see if things look bad for Qualcomm and they feel more desperate? There's no way they
> didn't have another couple weeks to make Qualcomm squirm - at least let the plaintiffs make their case
> and settle before Qualcomm defends to give them a public black eye. If it was Qualcomm caving, then
> the timing could perhaps make sense if they didn't like the jury they ended up with.
>
> That trial was the big enchilada, because an unfavorable ruling could see Qualcomm paying
> out far more than Apple's withheld payments, and open the door to lawsuits from other licensees
> to also sue, so even if they got less from Apple than they wanted that may have been better
> than leaving their fate up to 12 people who weren't able to get out of jury duty :)
>
> Perhaps it was a mutual cave, i.e. maybe Apple had recently signaled a willingness to make
> a deal if they were not happy with where Intel's 8160/10nm situation stood, but the offer
> wasn't good enough for Qualcomm until they saw the jury makeup and decided they better agree
> to what was on the table because it could only get worse if the trial goes badly.
>
> We may get some hints from Apple and Qualcomm's Q2 quarterly report in a few months, though
> it is pretty easy to hide one time items by mixing it with other one time items or taking
> it over several quarters if they choose to conceal it. Qualcomm's CEO refused to say how
> much of what they said Apple owed them that they were getting - was that due to a mutual
> gag order on the deal or did they want to save face? We'll probably never know.
>
> The only real numbers they provided was the $2/share pop Qualcomm said they expected from Apple buying
> chips, which suggests they expect to see about $12/phone - which would include both margin on the chip
> itself and licensing fees. So "all you need to do" is figure out what the chip costs to make, and how
> much Qualcomm is charging, and you can figure out what Apple is paying in royalties...
>
> I'll be very interested to see if all the job openings for cellular designers Apple suddenly disappear (indicating
> they are going all-in with Qualcomm, from which we could assume they got very good terms) or if we start hearing
> reports a lot of the best Intel guys are getting hired by Apple which means they still want to do their own modem.
> Personally I'd like to see them do that no matter what deal they got from Qualcomm - the baseband software is
> a huge gaping security hole that a company selling itself on privacy needs to control themselves.

Two points:
- What I consider an interesting intermediate point will be if Broadcom indicates they expect lower sales to Apple. A WiFi chip is lower complexity than cellular, so Apple swapping out Broadcom in devices more sophisticated than the Apple Watch would indicate that they have a process in place that can handle this sort of complexity at WiFi levels.

- As I read all the commenting about this, I keep seeing the same pattern of mistakes that somewhat overestimate (IMHO) the magnitude of Apple's task.
+ First it's not like Apple is starting from scratch TODAY in their modem efforts. We have no idea when they started. It was almost certainly before 2017 (which was rumors started appearing of an Apple modem team, and when Apple started talking to Intel)

+ Second it's not like Apple has to deliver EVERYTHING in the 5G spec at once. In particular mmWave appears to be the hardest, most different part of the spec. But it's also the least important (mainly solving a problem that's also solved by modern WiFi, the stadia and conferences problem). Meaning that I could see Apple getting away with shipping a non mmWave modem for a year or two, and that's assuming mmWave takes off enough that such a delay could extent to three or four years without anyone even caring.

+ Third Apple doesn't have to deliver 5G all at once, with all the risk that implies. There are a few natural steps along the way that could be used to introduce non-fully-specced modems for learning purposes. The lowest end might be an Apple Watch modem (only LTE, with no MIMO and the most minimal specs LTE allows). Next might be an iPad LTE modem (power/area/antenna demands are less rigorous). Then perhaps an Apple Watch 5G modem (again absolute minimum the spec allows). They could also segment to just supporting US specs for the first release, simplifying the world-wide matrix. They could even be fairly aggressive in stripping out older specs, at least insofar as such specs cannot be implemented 100% in software. So abandon GSM or EDGE or voice CDMA IF those prove any sort of impediment to the grander project.
Of course it's nice if you have those in place; but as I started with, you don't always get what you want, so you make decisions; and while the voices of the people complaining that EDGE no longer works will be very loud, the number of actual missed sales will be very small...
(And even people who NEED EDGE, all three of them, can be assured that it is coming, just buy next year's iPhone, not this year's...)
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TopicPosted ByDate
Apple agrees to become Qualcomm's licensee and returns to their baseband chipsDummond D. Slow2019/04/18 04:47 PM
  antitrust implications? (NT)anonymous22019/04/18 08:53 PM
    antitrust implications?Doug S2019/04/18 09:50 PM
      antitrust implications?Beastian2019/04/18 11:02 PM
  Apple agrees to become Qualcomm's licensee and returns to their baseband chipsDoug S2019/04/18 09:45 PM
    Apple agrees to become Qualcomm's licensee and returns to their baseband chipsdmcq2019/04/18 11:05 PM
      Apple agrees to become Qualcomm's licensee and returns to their baseband chipsBeastian2019/04/18 11:28 PM
        Apple agrees to become Qualcomm's licensee and returns to their baseband chipsAdrian2019/04/19 12:48 AM
          Apple agrees to become Qualcomm's licensee and returns to their baseband chipsdmcq2019/04/19 06:54 AM
            Apple agrees to become Qualcomm's licensee and returns to their baseband chipsAdrian2019/04/19 10:33 AM
              Apple agrees to become Qualcomm's licensee and returns to their baseband chipsdmcq2019/04/19 11:54 AM
            Apple agrees to become Qualcomm's licensee and returns to their baseband chipsMaynard Handley2019/04/19 12:03 PM
          Apple agrees to become Qualcomm's licensee and returns to their baseband chipsBeastian2019/04/19 08:38 AM
            Apple agrees to become Qualcomm's licensee and returns to their baseband chipssylt2019/04/19 10:28 AM
              Apple agrees to become Qualcomm's licensee and returns to their baseband chipsBeastian2019/04/19 11:03 AM
                Apple agrees to become Qualcomm's licensee and returns to their baseband chipssylt2019/04/20 12:08 AM
                  Apple agrees to become Qualcomm's licensee and returns to their baseband chipsBeastian2019/04/20 10:15 AM
                    Apple agrees to become Qualcomm's licensee and returns to their baseband chipsMaynard Handley2019/04/20 10:41 AM
                    Apple agrees to become Qualcomm's licensee and returns to their baseband chipssylt2019/04/20 02:22 PM
                      Apple agrees to become Qualcomm's licensee and returns to their baseband chipsBeastian2019/04/20 08:31 PM
                        Apple agrees to become Qualcomm's licensee and returns to their baseband chipsMaynard Handley2019/04/20 10:41 PM
                      Apple agrees to become Qualcomm's licensee and returns to their baseband chipsGroo2019/04/21 07:50 AM
            Apple agrees to become Qualcomm's licensee and returns to their baseband chipsAdrian2019/04/19 10:45 AM
              Apple agrees to become Qualcomm's licensee and returns to their baseband chipsBeastian2019/04/19 11:27 AM
                Apple agrees to become Qualcomm's licensee and returns to their baseband chipsMaynard Handley2019/04/19 12:09 PM
                  Apple agrees to become Qualcomm's licensee and returns to their baseband chipsBeastian2019/04/19 12:17 PM
                    Apple agrees to become Qualcomm's licensee and returns to their baseband chipsMaynard Handley2019/04/19 01:19 PM
                      Apple agrees to become Qualcomm's licensee and returns to their baseband chipsGroo2019/04/20 06:50 AM
                        Apple agrees to become Qualcomm's licensee and returns to their baseband chipsMaynard Handley2019/04/20 10:49 AM
                          Apple agrees to become Qualcomm's licensee and returns to their baseband chipsBeastian2019/04/20 11:08 AM
                            Apple agrees to become Qualcomm's licensee and returns to their baseband chipsMaynard Handley2019/04/21 12:18 AM
                              Apple agrees to become Qualcomm's licensee and returns to their baseband chipsMaynard Handley2019/04/21 12:19 AM
        Apple agrees to become Qualcomm's licensee and returns to their baseband chipsDoug S2019/04/19 10:46 AM
          Apple agrees to become Qualcomm's licensee and returns to their baseband chipsBeastian2019/04/19 11:50 AM
          Apple agrees to become Qualcomm's licensee and returns to their baseband chipsBeastian2019/04/19 04:17 PM
            Apple agrees to become Qualcomm's licensee and returns to their baseband chipsDoug S2019/04/19 10:59 PM
              Apple agrees to become Qualcomm's licensee and returns to their baseband chipsGroo2019/04/20 09:28 AM
              Apple agrees to become Qualcomm's licensee and returns to their baseband chipsBeastian2019/04/20 10:33 AM
                Apple agrees to become Qualcomm's licensee and returns to their baseband chipsMaynard Handley2019/04/21 12:26 AM
            Apple agrees to become Qualcomm's licensee and returns to their baseband chipsMaynard Handley2019/04/20 10:55 AM
      Apple agrees to become Qualcomm's licensee and returns to their baseband chipsAndreas2019/04/19 04:55 AM
    Apple agrees to become Qualcomm's licensee and returns to their baseband chipsAndrew Clough2019/04/19 06:19 AM
    Apple agrees to become Qualcomm's licensee and returns to their baseband chipsGroo2019/04/19 07:44 AM
    Apple agrees to become Qualcomm's licensee and returns to their baseband chipsMaynard Handley2019/04/19 11:49 AM
    Read this and realize what Apple doesGroo2019/04/19 04:27 PM
  Apple agrees to become Qualcomm's licensee and returns to their baseband chipsMaynard Handley2019/04/19 11:32 AM
    Apple agrees to become Qualcomm's licensee and returns to their baseband chipsDummond D. Slow2019/04/19 12:15 PM
    Apple agrees to become Qualcomm's licensee and returns to their baseband chipsDoug S2019/04/19 02:48 PM
      Apple agrees to become Qualcomm's licensee and returns to their baseband chipsMaynard Handley2019/04/19 03:53 PM
        Apple agrees to become Qualcomm's licensee and returns to their baseband chipsDoug S2019/04/19 11:05 PM
          Apple agrees to become Qualcomm's licensee and returns to their baseband chipsBeastian2019/04/20 10:49 AM
            Apple agrees to become Qualcomm's licensee and returns to their baseband chipsDoug S2019/04/21 12:07 AM
              Apple agrees to become Qualcomm's licensee and returns to their baseband chipsBeastian2019/05/15 07:51 AM
                Apple agrees to become Qualcomm's licensee and returns to their baseband chipsDoug S2019/05/15 11:16 AM
                Apple agrees to become Qualcomm's licensee and returns to their baseband chipsMaynard Handley2019/05/15 12:21 PM
  Apple agrees to become Qualcomm's licensee and returns to their baseband chipsDummond D. Slow2019/04/25 11:37 AM
    Apple agrees to become Qualcomm's licensee and returns to their baseband chipsMaynard Handley2019/04/25 12:43 PM
      Apple agrees to become Qualcomm's licensee and returns to their baseband chipsdmcq2019/04/26 02:22 AM
        Apple agrees to become Qualcomm's licensee and returns to their baseband chipsMaynard Handley2019/04/26 10:05 AM
          Apple agrees to become Qualcomm's licensee and returns to their baseband chipsBeastian2019/04/26 11:57 AM
            Apple agrees to become Qualcomm's licensee and returns to their baseband chipsAnon2019/04/27 04:11 PM
              Apple agrees to become Qualcomm's licensee and returns to their baseband chipsBeastian2019/04/27 08:15 PM
                Apple agrees to become Qualcomm's licensee and returns to their baseband chipsDoug S2019/04/28 06:59 AM
                  Apple agrees to become Qualcomm's licensee and returns to their baseband chipsBeastian2019/05/02 12:01 PM
                    Apple agrees to become Qualcomm's licensee and returns to their baseband chipsMaynard Handley2019/05/02 03:58 PM
                      Apple agrees to become Qualcomm's licensee and returns to their baseband chipsMaynard Handley2019/05/02 04:27 PM
                      Apple agrees to become Qualcomm's licensee and returns to their baseband chipsanonymou52019/05/02 05:37 PM
                        Apple agrees to become Qualcomm's licensee and returns to their baseband chipsDummond D. Slow2019/05/03 01:35 AM
                          Apple agrees to become Qualcomm's licensee and returns to their baseband chipsMaynard Handley2019/05/03 09:32 AM
                            Apple agrees to become Qualcomm's licensee and returns to their baseband chipsDummond D. Slow2019/05/03 01:32 PM
                              Apple agrees to become Qualcomm's licensee and returns to their baseband chipsMaynard Handley2019/05/03 03:45 PM
                                Apple agrees to become Qualcomm's licensee and returns to their baseband chipsUmmmm...2019/05/03 04:35 PM
                                  Apple agrees to become Qualcomm's licensee and returns to their baseband chipsMaynard Handley2019/05/03 04:56 PM
                                  Apple agrees to become Qualcomm's licensee and returns to their baseband chipsDummond D. Slow2019/05/03 09:10 PM
                                    Apple agrees to become Qualcomm's licensee and returns to their baseband chipsDummond D. Slow2019/05/03 09:11 PM
                                    Apple agrees to become Qualcomm's licensee and returns to their baseband chipsMaynard Handley2019/05/03 10:12 PM
                                      Apple agrees to become Qualcomm's licensee and returns to their baseband chipsDummond D. Slow2019/05/04 08:33 AM
                      Apple agrees to become Qualcomm's licensee and returns to their baseband chipsDoug S2019/05/03 01:11 AM
                        Apple agrees to become Qualcomm's licensee and returns to their baseband chipsBeastian2019/05/06 09:09 AM
                          Apple agrees to become Qualcomm's licensee and returns to their baseband chipsMaynard Handley2019/05/06 11:40 AM
                            Apple agrees to become Qualcomm's licensee and returns to their baseband chipsBeastian2019/05/06 01:16 PM
                              Apple agrees to become Qualcomm's licensee and returns to their baseband chipsMaynard Handley2019/05/06 04:15 PM
                        Apple agrees to become Qualcomm's licensee and returns to their baseband chipsSimon Farnsworth2019/05/07 05:23 AM
          Apple agrees to become Qualcomm's licensee and returns to their baseband chipsdmcq2019/04/26 12:52 PM
  Apple agrees to become Qualcomm's licensee and returns to their baseband chipsDummond D. Slow2019/05/02 09:25 AM
    So Qualcomm got less than 2/3 of what they wantedDoug S2019/05/02 10:35 AM
      So Qualcomm got less than 2/3 of what they wantedBeastian2019/05/02 11:43 AM
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