Apple and Qualcomm Bury the Hatchet; Sign New Patent and Chip Supply Agreements

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Putting an end to one of the most intense high tech legal battles in recent memory, this afternoon Apple and Qualcomm announced that the two firms were burying the hatchet. Effective immediately, all litigation between the two companies has been dropped, and the two have signed new patent license and chip supply agreements. As a result, the face of the cellular modem market is changing in an instant, as Apple’s shift in allegiances will have repercussions throughout the industry.

Overall, the joint press release put out by the two companies is very short on details, as the agreement is largely a private matter. To settle their legal affairs, Apple will be making a one-time payment to Qualcomm, presumably to cover any IP use since Apple cut off payments to Qualcomm in 2017. Replacing those lawsuits, Apple has signed a 6-year patent license agreement with Qualcomm, which is being backdated to April 1st. The agreement includes a further 2-year extension option, which if Apple eventually chooses to exercise it, would take the agreement through April of 2027.

Along with licensing Qualcomm’s patents, Apple is also going to resume buying chips from Qualcomm. A separate chipset supply agreement has been inked; though the official announcement doesn’t say for how long beyond the fact that it’s a “multiyear” agreement. Interestingly the word “modem” does not appear once in the press release itself, but from the nature of the two companies’ conflict and Apple’s own needs, clearly Qualcomm is once again going to be supplying modems for Apple’s iPhones and iPads.

As noted by Reuters, the sudden nature of the deal took many people by surprise. Apple and Qualcomm announced the deal as the two companies were simultaneously in federal court in San Diego, arguing their cases on day 2 of what was their ongoing trial. That trial is now over, as are all of Qualcomm and Apple’s other legal tussles across the world.

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