Federal Trade Commission rules Qualcomm must license its modem patents to competitors

The U.S. federal court in a lawsuit filed by the U.S. Federal Trade Commission (FTC), which monitors acts of commerce, ruled against Qualcomm over the alleged anti-competitive practices and abuse of FRAND patents. This means that Qualcomm must license its modem patents to competitors.

The motion was strongly supported by the rest of the industry and potentially weakens its stranglehold on the market. The ruling came out of a Federal Trade Commission lawsuit against Qualcomm, which was filed near the start of 2017. The key highlight of the ruling is whether Qualcomm has to license standard-essential patents to competitors and the court has ruled that it should do. Until now, Qualcomm has only offered licenses to companies that directly manufacture smartphones.

Qualcomm seems to have done that only when it was directly selling the chips to them. This means that companies like Intel which is badly trying to compete with Qualcomm had to work around Qualcomm’s patents to sell its modems of its own and brands like Apple and Samsung also had to play by Qualcomm to sell its smartphones. This is definitely bad news for Qualcomm and a sign of relief for rest of the industry. What doesn’t change with this ruling is how much Qualcomm charges for those patents.

The FTC has also accused Qualcomm of charging too-high fees for its patents. Apple is suing Qualcomm over the very same issue, but courts have yet to rule on this.