Arm Plans to Cancel Qualcomm's License, Issues 60-Day Notice

[AleksandarK]

According to Bloomberg, Arm Holding PLC, the holding company behind the Arm instruction set and Arm chip designs, just issued a 60-day notice period of license retirement to Qualcomm, its long-time partner. The UK-based ISA provider has notified Qualcomm that it will cancel the Arm ISA architectural license agreement after the contract-mandated 60-day notice. The issues between the two arose in 2022, just a year after Qualcomm acquired Nuvia and its IP. Arm filed a lawsuit claiming that the reason was "Qualcomm attempted to transfer Nuvia licenses without Arm's consent, which is a standard restriction under Arm's license agreements." To transfer Nuvia core licensing, Qualcomm would need to ask Arm first and create a new licensing deal.

The licensing reworking came just in time when Qualcomm experienced its biggest expansion. The new Snapdragon 8 Elite is being used in the mobile sector, the Snapdragon X Elite/Plus is being used in Copilot+ PCs, and the automotive sector is also getting the new Snapdragon Cockpit/Ride Elite chipsets. Most of that is centered around Nuvia Oryon core IP, a high-performance, low-power design. Arm's representatives declined to comment on this move for Bloomberg, while a Qualcomm spokesman noted that the British company was trying to "strong-arm a longtime partner."

This is more of the same from Arm - more unfounded threats designed to strongarm a longtime partner, interfere with our performance-leading CPUs, and increase royalty rates regardless of the broad rights under our architecture license. With a trial fast approaching in December, Arm's desperate ploy appears to be an attempt to disrupt the legal process, and its claim for termination is completely baseless. We are confident that Qualcomm's rights under its agreement with Arm will be affirmed. Arm's anticompetitive conduct will not be tolerated.

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[Dirt Chip]

This should be a good one
#popcorn

 

[shadad]

and...here we

 

[THANATOS]

Maybe they will make some blockbuster out of It in the future.

 

[lemonadesoda]

Looking forward to the car-owner chatter, wondering if their cars, or critical functions thereof, will be remotely turned off. Remember, so much of a modern car you do not own, you only license to use.

 

[Vayra86]

Strong-arm a partner. Ha ha ha

Looking forward to the car-owner chatter, wondering if their cars, or critical functions thereof, will be remotely turned off. Remember, so much of a modern car you do not own, you only license to use.

Puts a surprising new lens on ownership, too, wrt to software licensing.

I think its a too big to fail affair and we'll soon realize temporary licensing tied to hardware that people rely on is a bad thing.

 

[Imouto]

This is why open standards and free software should be the groundwork of everything tech related. And don't get me started in how much more efficient it would be.

 

[Vincero]

I don't get ARM's position in terms of:

a) Qualcomm had an architectural development license before buying nuvia... so what if they cancel the nuvia license, technically Qualcomm's license shouldn't be impacted - I don't think any court will agree with Qualcomm's specific license being revoked and I'd be surprised if their existing license had any clauses about buying out a competitor, although nuvia's existing being nulled I could see being accepted.

b) Even if the products derived from nuvia's license are tied to being produced by an ARM architectural licensee, with respect to (a) what's the big deal really... they'll still be getting their payments in. Maybe a judge might agree, but I don't see ARM being able to defend a position of somehow 'being at a material loss'.

c) At a time of growing interest, development and productionisation of RISC-V hardware, should you really be looking to p-off essentially one of your biggest customers.

d) If they get a judgement in their favour and ultimately Qualcomm have to pay X% extra per Snapdragon Elite product shipped as an end result, as per (c), do they really think that's going to be a benefit long-term?

I'm guessing Softbank are trying to get back some of the money they didn't get from selling ARM to Nvidia - investment company thinking striking again.

 

[Wirko]

This is why open standards and free software should be the groundwork of everything tech related. And don't get me started in how much more efficient it would be.

Having open standards for hardware, and open-sourced firmware and software, doesn't preclude DRM. Manufacturers (of cars, car computers, motherboards, BIOSes, chips) will keep signing keys for themselves, if nothing else.

I don't get ARM's position in terms of:

a) Qualcomm had an architectural development license before buying nuvia... so what if they cancel the nuvia license, technically Qualcomm's license shouldn't be impacted - I don't think any court will agree with Qualcomm's specific license being revoked and I'd be surprised if their existing license had any clauses about buying out a competitor, although nuvia's existing being nulled I could see being accepted.

b) Even if the products derived from nuvia's license are tied to being produced by an ARM architectural licensee, with respect to (a) what's the big deal really... they'll still be getting their payments in. Maybe a judge might agree, but I don't see ARM being able to defend a position of somehow 'being at a material loss'.

c) At a time of growing interest, development and productionisation of RISC-V hardware, should you really be looking to p-off essentially one of your biggest customers.

d) If they get a judgement in their favour and ultimately Qualcomm have to pay X% extra per Snapdragon Elite product shipped as an end result, as per (c), do they really think that's going to be a benefit long-term?

I'm guessing Softbank are trying to get back some of the money they didn't get from selling ARM to Nvidia - investment company thinking striking again.

Regarding (b), the involved parties can't even agree on what was developed at QC, and what was developed by Nuvia.

arm (is that the current proper capitalisation?) also has more strange ideas, like demanding license payments directly from companies who buy arm-based chips.

 

[Vincero]

arm (is that the current proper capitalisation?) also has more strange ideas, like demanding license payments directly from companies who buy arm-based chips.

GTFO!!!
Unless there is some sort of deferred agreement with the chip maker and device maker on who pays. What's next, charging Google extra if an Android builds adds support for a new ISA function?...

 

[Wirko]

GTFO!!!
Unless there is some sort of deferred agreement with the chip maker and device maker on who pays. What's next, charging Google extra if an Android builds adds support for a new ISA function?...

You'll see when your car seat heating switches to cooling in winter, and you'll start reading the fine print in all the EULAs in panic. Who the hell wants more of my money now, is it QC, arm, car maker, ECU maker, Spruce Pine Silicon Mine Railway Maintenance Service, all of them?

 

[Caring1]

You'll see when your car seat heating switches to cooling in winter, and you'll start reading the fine print in all the EULAs in panic. Who the hell wants more of my money now, is it QC, arm, car maker, ECU maker, Spruce Pine Silicon Mine Railway Maintenance Service, all of them?

Or the service is terminated as it's EOL.

 

[Imouto]

Having open standards for hardware, and open-sourced firmware and software, doesn't preclude DRM. Manufacturers (of cars, car computers, motherboards, BIOSes, chips) will keep signing keys for themselves, if nothing else.

We are talking about the relations between companies and that's the scope of my comment. A common ground where all the parties implied collaborate is the ideal scenario but all of them want absolute control over everything.

 

[Neo_Morpheus]

In 2019, Arm granted Nuvia two licenses: the Technology License Agreement (TLA) and Architecture License Agreement (ALA) one to modify its existing cores and another to design custom cores. These licenses were granted on the condition that Nuvia would develop datacenter-grade products and were non-transferable without Arm's approval, which Qualcomm did not obtain when it acquired Nuvia in 2021. As a result, Arm terminated Nuvia's licenses in 2022, but Qualcomm argued that its ALA also covered its subsidiary, Nuvia too. Qualcomm has subsequently released processors based on Nuvia's Phoenix (Oryon) cores, which Arm believes breach the contracts and infringe trademarks.

If that is true, then maybe Arm does have the right to sue and take this action.

And we do know that Qualcomm is no saint, so we shouldn't just blame Arm.

But besides personal likes, I'm pretty sure that Arm legal dept would have advised their superiors is the case has legitimacy or not before proceeding.

 

[persondb]

I don't get ARM's position in terms of:

I think for them it's a matter of survival. Qualcomm is a huge customer and them transitioning to custom cores is a huge impact to their revenue.

a) Qualcomm had an architectural development license before buying nuvia... so what if they cancel the nuvia license, technically Qualcomm's license shouldn't be impacted - I don't think any court will agree with Qualcomm's specific license being revoked and I'd be surprised if their existing license had any clauses about buying out a competitor, although nuvia's existing being nulled I could see being accepted.

Qualcomm license is supposedly for ARMv8. And Nuvia for ARMv9. They also supposedly had clauses for license transfer and stuff.

The custom cores for Snapdradon X Elite and 8 Elite are all ARMv9.

That is what I heard, though IDK about that. ARM seems to make a distinction in IP developed under Nuvia or Qualcomm.

This has been going on for years at this point

Arm’s Nuclear Option – Qualcomm Must Cancel Next-Generation Products If Arm Succeeds

Arm denies allegations of changing its business modelIf you have been keeping up with the biggest soap opera in the tech world, you know Arm sued Qualcomm. Qualcomm more recently made some pretty b…

www.semianalysis.com

b) Even if the products derived from nuvia's license are tied to being produced by an ARM architectural licensee, with respect to (a) what's the big deal really... they'll still be getting their payments in. Maybe a judge might agree, but I don't see ARM being able to defend a position of somehow 'being at a material loss'.

Supposedly the Nuvia license contract is more favorable to licensee because it was for Server chips, which is a more limited market in addition to one that ARM doesn't have much market share in.

That might be why ARM went into survival mode as it would get a fraction of a more favorable contract to them and much less than if they managed to license the cores.

c) At a time of growing interest, development and productionisation of RISC-V hardware, should you really be looking to p-off essentially one of your biggest customers.

It's also a time of growing interest in custom ARM cores too.

ARM probably does have a case as Qualcomm did the exact same thing in the past.

 

[Vincero]

If that is true, then maybe Arm does have the right to sue and take this action.

And we do know that Qualcomm is no saint, so we shouldn't just blame Arm.

But besides personal likes, I'm pretty sure that Arm legal dept would have advised their superiors is the case has legitimacy or not before proceeding.

Hard to say, it is arguable that through the lifetime of these CPU core engineering works that the company that owns it / designs it, as an entity it has always been covered under an applicable license.
Yeah, the licenses are non-transferable, but unless the license specifically states that the resulting products must be covered under that specific license - and crucially can't be 'reworked' under another license by another licensee - I'm not so sure it's that black and white.
At the end of the day, Nuvia designed some stuff under an applicable license - Qualcomm bought that as an asset - Qualcomm worked on that asset using it's own license that permits it to work on such type of product within the scope of that license.
It all comes down to if there is some measure of enforcement over the product that comes out of that Nuvia license - I expect that there was some royalty terms, and maybe they are different for Nuvia vs Qualcomm.... in which case I can see a judge just pushing them towards a settlement based on that difference.

Qualcomm license is supposedly for ARMv8. And Nuvia for ARMv9. They also supposedly had clauses for license transfer and stuff.

The custom cores for Snapdradon X Elite and 8 Elite are all ARMv9.

ARM probably does have a case as Qualcomm did the exact same thing in the past.

I can't believe that they would be that stupid... I mean I believe they could be.... not sure that they would be so obviously though...

 

[R0H1T]

I mean I believe they could be.... not sure that they would be so obviously though...

I mean haven't you seen QC sue anyone & everyone they could over modems, including Intel & Apple IIRC? QC is absolutely filthy when it comes to this kind of BS, hope ARM wins on merit here! Also just an FYI this is one of the reasons cited as to why AMD/Intel cross licensing on x86/x64 is a major roadblock for their (potential) sale, making it a virtual duopoly.

 

[bonehead123]

However this turns out, it won't matter, cause the lawyers will win in the end anyways, and then everyone concerned will have even more crap to bitch about when it comes to licensing agreements and IP & all that stuff.......

Also, speculation on who/what/where/when etc is a waste of time, unless you happen to have a complete copy of the signed agreements to use as a basis of your assumptions/opinions ect....

 

[R0H1T]

Even then it's a matter of interpretation, it's quite possible if ARM loses here (in the US) they could try to win this in the UK.

 

[z1n0x]

It seems to me that SoftBank is still mad at Qualcomm because they were one of the main blockers of the ARM-Nvidia deal. Probably Qualcomm would have to open the purse. MediaTek is loving this.

 

[hsew]

Regardless of who is in the right here, the aggressiveness of ARM will surely put other chipmakers on notice and likely cause a reimagining of their own long-term design strategies. With RISC-V enjoying increasing attention from the big players, this almost looks like a desperate play from ARM. It gives off RAMBUS vibes if nothing else.

 

[lilhasselhoffer]

So...will this actually influence consumers?

Qualcomm seeks an injunction over the cancellation of the contract, claiming the term are unfair. Qualcomm continues to produce while this is tied-up in court, functionally still paying out at the old licensing terms. ARM gets the stream of money from new sales, and it's used to pay the lawyers to fight this out in court for what likely will be years...and in 2030 there's a decision that whomever wins we all lose because the cost of this will eventually be leveraged onto consumers because the bickering and squabbling over IP this entangled will be a huge knot to untie.

I see only an eventual increase in price for consumers as the outcome, whether Qualcomm or ARM wins. That's...not really new at this point. It pains me to say that, but with how much development money is at stake here nobody is going to forego any petty squabbles that have any sort of monetary potential.

 

[unwind-protect]

What did everybody expect? This is the natural result of the licensing model.

Say hello to our RISC-V overlords.

 

[R0H1T]

I mean what did you expect really? Apple pays less than 30 cents on a chip they make, even if QC pays double that it's still peanuts! ARM is getting very little in this arrangement & is probably doing the most R&D outside x86 world ~

Report: Apple Pays Less Than 30 Cents in Royalties to Arm Per Chip

Apple pays British chip architect Arm less than 30 cents per chip in royalties, The Information reports. Apple licenses the underlying technology...

www.macrumors.com

 

[xorbe]

I always wondered why hardware companies would hang their existence on ARM's approval. Even if it's "30 cents per chip" somewhere there was a very large payment upfront initially.