Intel Says It Sold Its Modem Chip Business To Apple at 'a Multi-Billion Dollar Loss' Because Qualcomm Tactics Left It With No Other Choice (reuters.com) 44
Intel sold its smartphone modem chip business to Apple at "a multi-billion dollar loss," the U.S. chipmaker said in a court filing on Friday, alleging that rival Qualcomm forced it out of the market. From a report: Intel made the claims in a brief filed with the 9th U.S. Circuit Court of Appeals, where Qualcomm is seeking to overturn a sweeping antitrust decision against it after losing a lawsuit by the U.S. Federal Trade Commission. Intel, whose executives testified at the trial, argued on Friday that the ruling should stand. Appeal proceedings are expected to begin in January. In a 233-page decision issued in May, U.S. District Judge Lucy Koh in San Jose wrote that Qualcomm's patent licensing practices "strangled competition" in parts of the market for modem chips that connect smartphones to mobile data networks. She ordered the San Diego-based company to renegotiate licensing agreements at reasonable prices.
If there was no value in it (Score:2)
Re:If there was no value in it (Score:5, Insightful)
Because Apple makes the products that uses it.
Say it costs Intel $10 to make each chip. They want to sell them at $11 per chip, so they can make a profit. Qualcomm sells their chips at $10.50 because they can make them at $8 a chip.
Intel cannot compete with Qualcomm on price, as the margins are too low. However for Apple with they get chips at $10 a pop saving money over buying from Qualcomm.
Also any losses can normally be padded up in the total price of the full product.
Re: (Score:2)
So you are saying that Qualcomm making better products cheaper and pricing them lower is a problem because... ? I thought that was capitalism.
Re: If there was no value in it (Score:2)
Re: If there was no value in it (Score:3)
I recall Apple has some cross licensing agreements which Intel obviously didn't.
Re: (Score:2)
Probably they'll buy Huawei chips for $5 each instead.
Re: (Score:1)
Re: (Score:1)
They also have a new place to make other chips in the US.
Have to see if this was a smart thing to do in a decade.
Re: If there was no value in it (Score:5, Insightful)
Utterly wrong but nicely worded (Score:2, Informative)
You sound really good but you are completely wrong here. QC froze Apple out because Apple was sending QC secrets to Intel to help them out, then refused to let QC audit them as required in their contract. See here:
https://www.semiaccurate.com/2... [semiaccurate.com] (Note: Self link)
-Charlie
Mods, come on (Score:3)
Apple likes to design its own chips (Score:3)
Why would Apple have bought it? Even at a loss?
Because Apple likes to design its own chips, and it likes to integrate them. Consider the "computer on a chip" in the Apple Watch.
"The Apple "S" series is a family of Systems in Package (SiP) used in the Apple Watch. It uses a customized application processor that together with memory, storage and support processors for wireless connectivity, sensors and I/O comprise a complete computer in a single package. They are designed by Apple, and manufactured by contract manufacturers such as Samsung."
https://e [wikipedia.org]
Re: (Score:2)
Because Apple sees huge value in vertical integration and will pay a premium, the lawsuits are something enough money and lobbying can fix.
Re: (Score:2)
No value *to Intel*, but it's plausible that Apple can run the mobile chip development better. They have shown excellent execution in silicon. Remember, they got more performance out of Samsung's process than Samsung.
Bullshit (Score:5, Insightful)
Bullshit. Intel bought *4* fully functional modem teams, botched literally every modem they made, and now are trying to blame others. By botched every design, I mean there was literally never a single design that met the promised pre-silicon spec, the highlight of this was the Apple iPhone with both modems. The Qualcomm modem in the iPhone ran at 1Gbps in other phones that used it, 600Mbps, same as the Intel modem, in the iPhone. Coincidence?
Then there was the fact that they 'showed' multiple 5G chips and demos, all photoshopped fakes, but never once to my knowledge showed 5G silicon, functional or not.
https://www.semiaccurate.com/2... [semiaccurate.com] (Note: Self link)
I could go on but after a decade of literally never delivering on the lowest level promises, it is laughable that Intel is trying to blame others. If you want real humor, Intel's official tweeting of this travesty use A FAKE CHIP to promote it. You can't make this stuff up.
-Charlie
Re: (Score:2, Insightful)
Exactly this.
The cellular carriers and module vendors have had endless issues with bugs in the chips and firmware provided by Intel. They have been an absolute nightmare.
Their cable modems had a lot of flaws and issues, I went out of my way to buy ones without Intel chipsets.
uBlox also got sick of botched chipsets, and have been developing their own for some time now, and just released.
Re: (Score:2)
For the cable modems they bought bugged designs and were just too incompetent to fix it. WiFi has generally been a fucking mess too. RF and interop aren't their strength.
Re: (Score:2)
Re: (Score:2)
There are a couple of other things that make that FX processor look better than it did when it was first released. The Windows scheduler has been improved to be aware of the core pair architecture and schedule it appropriately, so it's faster now than it was then. Meanwhile, mitigations to speculative execution attacks have made the performance of Intel processors from that era WORSE; the impact is minor in most workloads, but there are a few use cases where they can cause a performance hit of 50%.
The fact
Re: (Score:3)
It's all been crap since Xscale (Score:2)
When exactly did Intel become a total failure? I noticed it when they had Xscale. It was the fastest ARM implementation at the time, but they never managed to get the power consumption down to reasonable levels.
Re:Bullshit (Score:5, Interesting)
While Intel is the last company that should be allowed to sue for antitrust matters, they're not wrong about this.
I used to work for Broadcom when they were getting their 4G/LTE shit together, including buying Samsung's fully qualified modem and development team. After a few months there was a note from the CEO explaining that there was zero money to be made and he was shutting down the entire division, taking something like a $2B charge. Qualcom was the 900lb gorilla on the high end and would sue anyone who tried to compete in that area, and China's state sponsored, lose money until they have market share companies were eating everything on the low end. There was literally no one to sell to unless you make your own devices like Apple.
Re: (Score:2)
Charlie, if I may use this opportunity to be off-subject, the forum section on your site was very appreciated and is dearly missed. It would be very nice if you enable it again one day.
Thanks for all your work and the free information you have provided us for years.
Best regards.
Re: (Score:2)
Bullshit. Intel bought *4* fully functional modem teams, botched literally every modem they made, and now are trying to blame others. By botched every design, I mean there was literally never a single design that met the promised pre-silicon spec, the highlight of this was the Apple iPhone with both modems. The Qualcomm modem in the iPhone ran at 1Gbps in other phones that used it, 600Mbps, same as the Intel modem, in the iPhone. Coincidence?
Then there was the fact that they 'showed' multiple 5G chips and demos, all photoshopped fakes, but never once to my knowledge showed 5G silicon, functional or not. https://www.semiaccurate.com/2... [semiaccurate.com] (Note: Self link) I could go on but after a decade of literally never delivering on the lowest level promises, it is laughable that Intel is trying to blame others. If you want real humor, Intel's official tweeting of this travesty use A FAKE CHIP to promote it. You can't make this stuff up.
-Charlie
I always felt that Intel was a marketing company, not an innovative corp that produced quality innovative products. New products came to market via buyouts, and not really via internal R & D
Oh nooos (Score:4, Insightful)
Re: (Score:3)
My heart bleeds for a company that routinely stifled competition to try and make bank. I can dig up some references but anyone reading this already knows.
Exactly my thought. Intel deserves what they get in this case. They've been anti-competitive for decades. Time to stop whining.
Force to license IP? (Score:2)
Why should any company be forced to license its technology .. and at a price the customer finds reasonable? Wtf?
Intel should be forced to allow jokers to make its second place CPUs then? Intel is the same company that sued AMD because they thought 3 letter opcodes were copyrightable. They also block pin for pin compatibility which is why motherboards have to differ from AMD vs Intel. Intelâ(TM)s exorbitant licensing fees is also the reason USB and Lightening cables dont go for 25 cents each. Think abou
Re: Force to license IP? (Score:2)
Re: (Score:2, Flamebait)
"Why should any company be forced to license its technology ..."
Because unbridled capitalism does not work.
"... and at a price the customer finds reasonable? Wtf?"
It is not the customer that defines what is reasonable.
The rest of your whining isn't worthy of a response.
Re: Force to license IP? (Score:2)
Back in the 1970s and 1980s, buyers like NASA, the US Gov't, and AT&T would non-negotiably DEMAND that any technology they used have a second source, simply because they didn't want to risk disruption if a single factory or manufacturer had a fire, strike, disaster, went out of business, or simply became unreasonable. So... when TI made a new chip & wanted to sell it to AT&T, it had to PAY someone like Rockwell, NatSemi, Motorola, RCA, etc to second-source it as a condition of AT&T/USmil/NAS
Re: (Score:2)
Why should any company be forced to license its technology ..
In all fairness innovation costs money. A company spends billions creating a new technology. If they can't patent and license that technology then they have no incentive to spend billions in the first place. No innovation would ever happen because no one would get paid for their work.
Think about it like this... if you spent all summer planting crops and at harvest time anyone could come take it from you, would you spend next summer tending the field? Nope. And then no one gets to eat.
Re: (Score:2)
If Intel hadn't been sandbagging for the last 30 years overclocking wouldn't be a thing. Intel has been routinely sitting on tech and releasing it a bit at a time (for big dollars) since the 1980s.
Re: (Score:1)
In all fairness innovation costs money. A company spends billions creating a new technology. If they can't patent and license that technology then they have no incentive to spend billions in the first place.
You should really read up on how Qualcomm abuses FRAAND, especially after they make representations that they will abide by FRAAND - ie, charge everyone the same rate. Instead, they charge it by your selling price, so the cost of their chip in a $200 phone and a $1000 phone is 5x more expensive, for the same damned chip. Fuck Qualcomm
Re:Force to license IP? (Score:4, Insightful)
"Why should any company be forced to license its technology .. and at a price the customer finds reasonable?"
To get it included as part of an industry standard. At that point there can no longer be competing IP thus you don't have a market to set prices and need some other mechanism.
We shouldn't have patents (Score:3)
Re: (Score:2)
False. We should fix the patent system. The principles behind the patent system are quite solid an beneficial. The problem is when patents are bought and sold, held by non-operating entities, and granted for stupid reasons and dubious inventions.
Patents should last 5 or 10 years (Score:1)
The patent system is basically good - you get to make money provided you tell everyone how you did it. But it was developed centuries ago, before mass production and marketing and communications, so its timescales are based on horse-and-cart speeds. Nowadays you should be able to get rich on a software idea in 5 years, and 10 years for hardware Max, no renewals
Anti-trust (Score:2)
Why (Score:2)
Oh man, can you imagine all the kickbacks to politicians to get them to back off, or encourage, regulators, to help convince government to pick economic winners and losers?
That's not how we do business here in America!