Here we go again. Qualcomm has found itself in the middle of yet another grueling battle. This time with Arm, the chip technology company it has been working with. While no one knows how long this new fight will last, looking back on past battles, it could last a while. This is a distraction for both companies. While I hope this gets settled quickly, based on what we have seen in previous battles, I think investors and the industry in general should be prepared for a protracted fight.
The funny thing is, Qualcomm and Arm have had a long, solid and profitable working relationship. That’s why this battle seems like much ado about nothing. Yet here we are once again.
This whole dispute seems to have come around after Qualcomm acquired Nuvia. It seems to be about which contract Qualcomm and Arm will work under, going forward.
Qualcomm says it’s one contract, and Arm says it’s the other. The problem here is both companies have been battle-hardened over the years.
In the end, both will survive and hopefully get back to focusing on real growth opportunities.
What Arm-Softbank, Nuvia-Qualcomm battle is focused on
Arm is owned by the Softbank Group Corporation. They are suing Qualcomm and their recently acquired computer chip design company Nuvia for breaching licensing agreements and trademark infringements.
So, this is a new battle between two Goliath’s in the semiconductor industry.
The Arm position is that they should have been approached for their approval before the Nuvia work could be transferred to Qualcomm.
The Qualcomm position is after they acquired Nuvia last year, Arm does not have the right to interfere with their business.
If both Arm Softbank and Nuvia Qualcomm have a point, which will win?
These kinds of disputes are always centered around money, power and control.
Both companies have a point. So, who is right? That is the multi-billion-dollar question.
When I visit the Qualcomm campus, I always see the walls of their convention center plastered with countless patents. These are all victories and a testament to Qualcomm’s growth and power in the wireless industry.
That’s why I don’t see Qualcomm backing down. I also don’t see Softbank backing down. So, this is the battle which will take plenty of money and time to litigate.
Any way you slice it, in the end I believe both Qualcomm and Arm will make piece and continue to work together. After all, this kind of battle between industry leaders have been fought before and that’s the end result.
This is a spat. It is just a matter of bringing two working partners together again.
Happy ending between Qualcomm Nuvia and Softbank Arm is not guaranteed
If Softbank wins, this battle could potentially unravel the Nuvia asset that Qualcomm is focused on growing with. That could negatively impact their working relationship going forward.
My hope is they will both settle this dispute and get on with working together and their focus on leading the industry.
Qualcomm has told the marketplace it will use Nuvia chips for their growing assortment of smartphones, tablet’s, computers, IoT, AI, Automotive, healthcare and other areas.
They need Nuvia technology. These are important areas for Qualcomm to expand into for continued growth.
To tell you the truth, I didn’t think this battle would last this long. It should have been settled quickly. However, this is now starting to look like it will become a protracted battle.
It is in both of their best interests to settle this dispute quickly and get back to business.