| | | Curious, re: QCOM IP Licensing...............................
1) Of course Q IP operates in a "network."
1a) Thought you were unaware that Q has IP related to the network itself.
Q has SEPs in the phone/infra which are not practiced in silicon (modem, power control etc.)? I am not challenging you. I am asking because I do not know.
1b) Of course it should charge a royalty from parties who manufacture and sell parts incorporate its IP. In fact, what it is doing is contrary to this practice. In order to circumvent patent exhaustion, it has to deliberately forego any licensing with parties who do apply its IP (Intel, Mediatek, Spreadtrum, captives etc.)
On the contrary, what QCOM is doing (royalties at the device level) has been cellular wide industry practice for over 3 decades.
Mallinson’s study as posted by Vinny (thanks) IMO effectively responds to your concerns, as it (SSPPU) is ( “completely inapplicable in the real world of licensing negotiations involving portfolios that may have thousands of patents reading on various components, combinations of components, entire devices, and networks....” Again, for over 3 decades imposing royalties at the device level has been accepted industry practice and as reflected in QCOM’s case by FRAND licenses with over global companies.
Busting Smartphone Patent Licensing Myths" from Sept. '15 sls.gmu.edu
Myth 1: Licensing royalties should be based on the smallest saleable patent practicing unit (SSPPU) implementing the patented technology, and not on the handset. The SSPPU concept is completely inapplicable in the real world of licensing negotiations involving portfolios that may have thousands of patents reading on various components, combinations of components, entire devices, and networks. In the cellular industry, negotiated license agreements almost invariably calculate royalties as a percentage of handset sales prices. The SSPPU concept is inapplicable because it would not only be impractical given the size and scope of those portfolios, but it would not reflect properly the utility and value that high-speed cellular connectivity brings to bear on all features in cellular handsets.
Royalties could be imposed at the modem level but that in itself is not a workable solution as QCOM has stated less than 10% of its IP is practiced entirely within the modem.
A better option might be to have the world’s 3G/4G carriers impose a use tax on each subscriber / device (8 cents/month?) but I doubt there’s any global consensus for that happening after 3 or 4 decades of operating under the current system.
1c) It is not only my opinion that Q's practice of aggregating and bundling SEPs and non-SEPs is problematic. NDRC thought so. The Taiwanese and Koreans thought so. Will our courts also think so? Whether that practice originated with the reviled gsm guild is not relevant to today's challenges Q faces.
As I stated, over that time QCOM has faced and resolved similar litigation issues, including resolving the bundling of SEP and NSEP patents. It’s my understanding that AAPL was offered the same terms but again declined to license under those terms as it continued its 10+ years resistance to accept FRAND licensing terms agreed to by more than 300 global companies.
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