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The Saga Continues, Now Qualcomm Claims ARM Will Be Charging Royalties


Qualcomm Claims They Heard Some OEM Said ARM Is Going To Be Mean To Everyone And Not Just Them

Qualcomm seems to be looking for a new fight, after their war against Apple more or less ended. The first hint was that they were first in line to claim that NVIDIA’s proposed acquisition of ARM, raising legal objections with every anti-trust organization they thought might be interested. Thankfully they were not the only ones to do so, and that proposition was withdrawn earlier this year. There was another acquisition which went through, Qualcomm’s purchase of Nuvia, and therein lies the source of the accusation Qualcomm launched.

Nuvia had an Arm technology license to allow them to develop custom ARM processors, just like anyone else that works with ARM. If you are not familiar with how ARM (and SoftBank) make their money, the short version is that they charge a fee for providing the initial blueprints of one of the processors, and a royalty on each chip sold by the license holder after it hits the market. They don’t fab their chips, they license the chip or the architecture and live off the royalties. Considering there have been over 230 billion ARM chips produced as of 2022, this is rather lucrative.

When Qualcomm bought Nuvia, they decided that they didn’t need to bother seeking ARM’s permission to take over Nuvia’s ARM license and instead decided that the chips now fell under Qualcomm’s existing ARM licensing. Qualcomm pays significantly less royalty per chip than Nuvia, as they negotiated a good deal with ARM a long time ago. Unsurprisingly, ARM doesn’t feel the same way and so they launched a lawsuit to force Qualcomm to negotiate a new licensing deal for the use of Nuvia’s chips. This legal battle has become one of the more entertaining ones to follow, and today’s new one does not disappoint.

Today, Qualcomm claimed that they heard from an unnamed OEM that ARM intends to scrap all existing licensing agreements with all their customers; the attempt to renegotiate with Qualcomm is merely a smoke screen. The submitted claim also suggests that in three years ARM will completely abandon their current business model and will no longer allow companies to add their own technology to ARM processors. Instead, anyone licensing ARM CPU architecture will be forced to also use ARM GPUs and AI accelerators and they will no longer be able to integrate ARM designs with their own products.

As ridiculous as this claim sounds, for it would indicate a complete remaking of ARM’s business model in a way that is likely to utterly destroy them as a company, ARM is having troubles and needs to find a way to address them. They are currently hemorrhaging talent in part because of the hiring freeze during NVIDIA’s attempt to absorb ARM, and their best and brightest move on to other companies. Their parent company SoftBank is also in trouble for a number of reasons, the most amusing being Arm China’s CEO Allen Wu refusing to leave after being fired in 2020. Two years later, he still retains control of that portion of ARM.

Legal battles are often boring, but somehow when Qualcomm is involved they tend to be more amusing than most!



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Naveen Kumar

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