Qualcomm must license chip patents to competitors, judge rules

Qualcomm suffered a setback in its legal battle with Federal Trade Commission this week when a federal judge ruled that the San Diego company is obligated to offer patent licenses to competitors.
The decision could have wide-ranging implications for Qualcomm’s patent licensing business model, which today collects royalties based on the wholesale price of smartphones, not individual components inside them.
Device-level royalties have been the norm in the cellular industry for decades. In August, the FTC asked U.S. District Judge Lucy Koh in San Jose to rule that Qualcomm’s pledges to two standard-setting organizations require it to offer patent licenses to all — including chip competitors.