Qualcomm lowers licensing rates in effort to appease Apple

Qualcomm is adjusting its licensing model to lower fees, Reuters reports, in a move that will hopefully help to resolve the company’s ongoing battle with Apple and others over what the other companies have called unreasonable licensing rates and royalties. The new terms would allow handset makers such as Apple to license Qualcomm’s smaller set of “standard essential patents” for a lower rate of 3.25 percent, as opposed to the normal five percent fee that Qualcomm charges for rights to its full patent suite. The “standard essential patents” are said to include only those need for access to mobile data networks, but Qualcomm has in the past tried to push customers to licensing both sets of patents to avoid lawsuits. Now, the company is taking steps to make it easier for customers to license just the lower-cost set of patents, as well as adding the patents for the next-generation 5G wireless network to the basic suite at no additional cost.
To be clear, Qualcomm has not lowered their patent rates, but is instead simply including more technology in the set of basic patents at the same rate as before. Qualcomm has, however, said that it will be lowering the price cap for its patent fee assessment down to the first $400 of a phone’s net selling price, from the prior threshold of $500. It remains to be seen whether these changes will have any impact the ongoing legal battle with Apple, and Qualcomm has naturally not commented on the status of talks with any of its customers, but the inclusion of 5G technology patents in the standard portfolio represent a different approach than the company has taken to new technologies in the past, such as when 3G and 4G networks were rolled out.


Jesse Hollington was a Senior Editor at iLounge. He's written about Apple technology for nearly a decade and had been covering the industry since the early days of iLounge. In his role at iLounge, he provided daily news coverage, wrote and edited features and reviews, and was responsible for the overall quality of the site's content.