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Qualcomm & ITC EVDO / WCDMA Ban

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Michael
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Joined: 13 Jan 2005
Posts: 5140
Location: Cary, IL

Posted: Mon Jun 11, 2007 6:27 am Post subject: Qualcomm & ITC EVDO / WCDMA Ban

Quote:

The International Trade Commission voted late on June 7 to ban the import of wireless devices that use Qualcomm chips (EVDO / WCDMA) and chip sets that infringe on certain Broadcom patents from entering the United States.

The ban affects cell phones, PDAs, broadband cards and other similar devices intended for consumer use. However, the ITC excluded existing models of such devices from the ban, allowing cell phones already on the market to continue to be sold.

Still up in the air is exactly how this ban will take place, and whether it will take place at all. Qualcomm announced in a press release that it would appeal; Verizon has announced that it would attempt to get the White House to overturn the ban; and both companies involved have said that they are negotiating a cross-licensing deal.

The companies most affected, Sprint and Verizon Wireless, have yet to release any statement regarding the impact from the ITC decision. However, both companies are certainly affected given their dependence on Qualcomm chip sets for a variety of uses including EVDO.

Here are a few press releases from Qualcomm on the subject:

http://www.qualcomm.com/press/releases/2007/070520_federal_jury_finds.html

http://www.qualcomm.com/press/releases/2007/070607_disagrees_itc_decision.html
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Michael
Site Admin

Joined: 13 Jan 2005
Posts: 5140
Location: Cary, IL

Posted: Mon Jun 11, 2007 6:40 am Post subject:

Which phones / devices are affected?

Quote:

"The exclusion order does not apply to handheld wireless communications devices that are of the same models as handheld wireless communications devices that were being imported for sale to the general public on or before the date of the order, June 7, 2007. However, the order does bar the importation of new models of handheld wireless communications devices that contain Qualcomm's infringing chips and chipsets. Thus, the order "grandfathers" models of handheld wireless communications devices being imported into the United States for sale to the general public on or before June 7, 2007."

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Mackieman
EVDO Junkie

Joined: 31 Oct 2005
Posts: 490

Posted: Mon Jun 11, 2007 11:34 am Post subject:

It should be noted that the order does not apply to PC data cards or to PDA handsets.

Alex
Site Admin

Joined: 19 Sep 2006
Posts: 2312
Location: Dallas, TX

Posted: Mon Jun 11, 2007 12:11 pm Post subject:

Mackieman wrote:

It should be noted that the order does not apply to PC data cards or to PDA handsets.

can you reference a page or part of actual suit that specifically says this?
it would help to allay some fears about EVDO devices.

thanks!

Mackieman
EVDO Junkie

Joined: 31 Oct 2005
Posts: 490

Posted: Mon Jun 11, 2007 1:43 pm Post subject:

Alex wrote:

can you reference a page or part of actual suit that specifically says this?
it would help to allay some fears about EVDO devices.

thanks!

Wish granted: http://www.usitc.gov/secretary/fed_reg_notices/337/337-TA-543.Notice.1181248076.pdf =)

If you scroll down to page two, paragraph five, the following information is displayed:

The International Trade Commission wrote:

The Commission has determined that the appropriate form of relief is, inter alia, a limited exclusion order prohibiting the unlicensed entry of baseband processor chips or chipsets, including chips or chipsets incorporated into circuit board modules and carriers, manufactured abroad by or on behalf of Qualcomm or any of its affiliated companies, parents, subsidiaries, contractors, or other related business entities, or their successors or assigns, that are programmed to enable the power saving features covered by claims 1, 4, 8, 9, or 11 of the ‘983 patent, as well as handheld wireless communication devices, including cellular telephone handsets and PDAs, containing Qualcomm baseband processor chips or chipsets that are programmed to enable the power saving features covered by claims 1, 4, 8, 9, or 11 of the ‘983 patent. The Commission limited exclusion order does not apply to computer data cards.

There was a further clarification provided somewhere else that defined devices with QWERTY keypads as exempt (including PDAs) but other PDA devices without keypads were included. I can't find the reference on that one right now.

Alex
Site Admin

Joined: 19 Sep 2006
Posts: 2312
Location: Dallas, TX

Posted: Mon Jun 11, 2007 2:15 pm Post subject:

thanks very much for the info, mackieman. looks pretty convincing to me... hope it gets interpreted the same way we are interpreting it!

Michael
Site Admin

Joined: 13 Jan 2005
Posts: 5140
Location: Cary, IL

Posted: Fri Jun 15, 2007 10:05 am Post subject:

Here is the "offical" word from Sprint on this topic:

Quote:

"Currently, there is no supply disruption or restrictions on inventory with our existing product lineup. Regarding our future product roadmap, we continue to assess the implications of the ITC decision and we are working with our vendors to avoid disruptions to planned future launches."

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Michael
Site Admin

Joined: 13 Jan 2005
Posts: 5140
Location: Cary, IL

Posted: Mon Jun 18, 2007 8:56 pm Post subject:

Quote:

The ITC previously determined that Qualcomm’s cellular baseband chips infringe five patent claims related to power conservation in cellular phones. The ban went into effect immediately and becomes permanent if the president does not overturn it within 60 days of June 7. During the 60-day period, suppliers and carriers can import new models with the offending chips by posting a bond, but the companies risk losing their bond if the ruling is allowed to stand.

Now, we know how carriers are able to introduce new phones Smile

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Michael
Site Admin

Joined: 13 Jan 2005
Posts: 5140
Location: Cary, IL

Posted: Mon Jun 25, 2007 3:54 pm Post subject:

Looks like Qualcomm has a patch to the problem (which is why the Mogul/PPC-6800 was successfully launched last week):

Quote:

NEW YORK, June 25 (Reuters) - Sprint Nextel Corp. (S.N: Quote, Profile , Research) is using a software patch from Qualcomm Inc. (QCOM.O: Quote, Profile , Research) to get around a recently issued U.S. government agency ban on new phones with Qualcomm chips, an executive for Sprint said on Monday.

The International Trade Commission on June 7 banned the import of new high-speed wireless phones containing Qualcomm chips that the ITC said infringed a patent owned by Broadcom Corp. (BRCM.O: Quote, Profile , Research). The ban exempts phones already being imported.

Because Sprint, the No. 3 U.S. wireless service, depends on devices with Qualcomm chips for virtually all its phones with high-speed Web links, analysts had said it could be prevented from launching new phone models as a result of the ban.

But Sprint product manager Brita Horton said in an interview that the company would be unaffected by the ban and can bring out as many new devices as it wants this year as a result of a software update it received from Qualcomm.

"Qualcomm gave us a software patch that ... lets us keep shipping," said Horton, who noted that while the software patch creates extra work for Sprint, it would not increase costs.

Qualcomm has said it was looking at possibilities for a technical way to get around the ban, but had noted that a work-around would not be a guaranteed solution as it requires the agreement of carriers and phone makers to be usable.

It said it is now focusing on reversing the ban through an appeals court and a presidential veto.

Verizon Wireless, the No. 2 U.S. mobile service in terms of subscribers, has spoken out against the ban and said it would ask U.S. President George W. Bush to veto it. Verizon Wireless, a venture of Verizon Communications (VZ.N: Quote, Profile , Research) and Vodafone Group Plc (VOD.L: Quote, Profile , Research), uses the same wireless technology as Sprint.

Qualcomm is the dominant supplier of chips for EV-DO, the high-speed wireless technology used by Sprint and Verizon Wireless.

http://yahoo.reuters.com/news/articlehybrid.aspx?storyID=urn:newsml:reuters.com:20070625:MTFH71986_2007-06-25_21-56-41_N25313580&type=comktNews&rpc=44
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Michael
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Joined: 13 Jan 2005
Posts: 5140
Location: Cary, IL

Posted: Thu Jul 19, 2007 7:56 pm Post subject:

Interesting....

Quote:

SAN DIEGO (AP) -- Verizon Wireless said Thursday that it struck a licensing deal with chipmaker Broadcom Corp., averting a ban on imports that would have threatened the introduction of new phones.

Verizon Wireless had previously sided with chipmaker Qualcomm Inc. to help overturn a U.S. International Trade Commission ban on imports of high-end phones that contain Qualcomm chips. The ITC found that Qualcomm infringed on a patent that protected Broadcom's technology to conserve battery power.

The ban, which took effect in June, poses a potentially big headache for carriers and handset makers because it may prevent them from introducing phones ahead of the Christmas buying season. The Bush administration has until Aug. 6 to overturn the decision.

Verizon Wireless agreed to pay Broadcom $6 for each phone that carries a patent-infringing Qualcomm chip. It will pay a maximum of $40 million a quarter, or $200 million over the life of the agreement.

The agreement also gives Verizon license to five other Broadcom patents that are the subject of legal disputes between the two chipmakers.

Verizon Wireless said it will drop efforts to reverse the ITC ruling and withdraw from a Qualcomm-led request for a federal appeals court to halt the ban, depriving Qualcomm of a powerful ally in its fight.

Verizon Wireless, which has 60.7 million customers nationwide, is breaking ranks with other carriers and handset manufacturers who have urged the Bush administration to overturn the ban. They argue consumers and public safety agencies would suffer most.

"We wanted to put this behind us and wanted certainty for our customers and our business," said Nancy Stark, a spokeswoman for Verizon Wireless. "We have new models coming out all the time."

The ban affects the high-speed EV-DO and WCDMA network technologies. Carriers that stand to suffer include Sprint Nextel Corp., which relies heavily on Qualcomm chips. Hardest hit among manufacturers would include LG Electronics Inc. and Samsung Electronics Co.

Qualcomm, based in San Diego, called the agreement a "positive development" because it ensures a supply of new phones for Verizon Wireless and its customers. But a spokesman, Bill Davidson, said uncertainty remains for other carriers and that Qualcomm would continue efforts to overturn the ITC ban.

Last month, Qualcomm rejected a proposal to pay Broadcom $6 for each patent-infringing phone, claiming the proposed deal would cost it up to $2 billion. Unlike the deal with Verizon Wireless, Broadcom's offer did not include a $200 million cap.

The cap represents "a drop in the bucket" for Verizon Wireless, said Mark McKechnie, a securities analyst at American Technology Research in San Francisco. The carrier, a joint venture of New York-based Verizon Communications Inc. and Vodafone Group PLC, posted $38 billion in revenue last year.

Broadcom, based in Irvine, is a newcomer to supplying chips for mobile phones but has scored legal victories against Qualcomm, an industry pioneer and the world's second-largest chipmaker for mobile phones after Texas Instruments Inc.

Broadcom executives said the deal with Verizon demonstrates willingness to negotiate.

"It sort of calls into question why is Qualcomm being so recalcitrant and digging in their heels so hard," Eric Brandt, chief financial officer, told analysts on a conference call.

Broadcom shares rose $1.63, or 5 percent, to $33.99 Thursday. Qualcomm's shares fell $1.75, or 3.9 percent, to $43.35.

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Michael
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Joined: 13 Jan 2005
Posts: 5140
Location: Cary, IL

Posted: Mon Aug 06, 2007 7:49 pm Post subject:

Quote:

Bush Administration Upholds Phone Ban in Qualcomm Patent Dispute

SAN DIEGO (AP) -- The Bush administration upheld an import ban Monday on cell phones that contain Qualcomm Inc. chips, further threatening the introduction of new handsets.

U.S. Trade Representative Susan Schwab said she was sticking to a long practice of declining to overrule the U.S. International Trade Commission unless conditions were "extraordinary." The executive branch has overruled the ITC only five times, most recently in 1987.

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In June, the ITC banned imports of new, high-end phones that run on Qualcomm chips, raising doubts about the introduction of some models from carriers including Sprint Nextel Corp. and manufacturers like LG Electronics Inc. and Samsung Electronics Co.

The ITC ruling came in patent dispute between Qualcomm and rival chipmaker Broadcom Corp. The commission found that Qualcomm infringed on a patent that protected Broadcom's technology to conserve battery power.

Schwab noted that industry players are working on alternative products to avoid the ban. She said a Department of Homeland Security review found insufficient justification for overturning the order on grounds that it would create problems for public safety agencies.

Qualcomm said it will ask the U.S. Court of Appeals for the Federal Circuit in Washington to reverse the ban and put it on hold while its appeal is considered. Chief Executive Officer Paul Jacobs said in a statement that he was disappointed but added Qualcomm will pursue "all legal and technical options available" to limit the impact on consumers.

The ban applies to the high-speed EV-DO and WCDMA network technologies, which allow users to more quickly surf the Internet and download music and video.

Qualcomm is using alternative software designed to escape the ban, but Broadcom may claim that it also infringes on its patent, Qualcomm attorney Alex Rogers said. A Broadcom attorney, David Rosmann, said he was unaware of Qualcomm's change and would reserve judgment until the company has a chance to review it.

Schwab acknowledged worries that the ban may slow the introduction of so-called third-generation, or 3G, mobile phones but said Broadcom's licensing deals with "two major wireless carriers" would soften the impact.

Verizon Wireless, whose phones run on Qualcomm chips, struck a deal with Broadcom last month to pay for each phone it sells that carry one of Qualcomm's patent-infringing chips, ducking the ban and depriving Qualcomm of a powerful ally in its legal fight. Neither the U.S. trade representative nor Broadcom would identify the second carrier to strike such a deal.

AT&T Inc., with 63.7 million wireless customers nationwide, declined to say if it struck a deal with Broadcom to avert the ban. AT&T is less dependent on the technology affected by the ban than Verizon Wireless or Sprint Nextel, but a spokesman, Michael Coe, said Qualcomm's chips are still important.

"There are not a lot of options (for 3G phones) beyond the Qualcomm chips," Coe said. "We are taking steps to make sure we continue to have an adequate supply for our customers."

A spokeswoman for Sprint Nextel, Leigh Horner, said that the carrier had not struck a deal with Broadcom and is instead using Qualcomm's alternative fix. Sprint Nextel will also ask a federal appeals court to halt the ban.

The decision, announced after markets closed, was widely anticipated by investors and analysts. Qualcomm shares rose $1.01, or 2.5 percent, to $41.78 in regular trading, then surrendered 28 cents after hours. Broadcom's shares climbed 48 cents, or 1.5 percent, to close at $33.44, then added 31 cents after hours.

Qualcomm, based in San Diego, is the world's second-largest chip supplier for mobile phones after Texas Instruments Inc. but earns much of its money from licensing fees on its patented technology. Broadcom, based in Irvine, is a newcomer to the cell phone business but has scored several legal victories against Qualcomm this year.

The impasse resembles a long-running patent dispute involving the maker of the BlackBerry e-mail device that ended in March 2006 when manufacturer Research In Motion Ltd. agreed to pay a $612.5 million settlement to NTP Inc. Uncertainty about the outcome had left BlackBerry customers wondering whether they would experiences brief outages or even a shutdown.

Qualcomm has warned of far-reaching harm to consumers who may be unable to buy the newest phones. It commissioned a study that estimated the cost to consumers and the wireless industry at between $4.3 billion and $21.1 billion, depending on the length of the ban. The study was done before Verizon Wireless ducked the ban.

Broadcom officials say the ban's impact would be limited.

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Michael
Site Admin

Joined: 13 Jan 2005
Posts: 5140
Location: Cary, IL

Posted: Wed Sep 12, 2007 8:12 pm Post subject:

Quote:

Court Puts Hold on Qualcomm Import Ban
Wednesday September 12, 9:10 pm ET
By Christopher S. Rugaber, AP Business Writer
Federal Court Halts Ban on Imports of Qualcomm Cell Phones; Defeat for Broadcom

WASHINGTON (AP) -- A federal judge Wednesday halted an import ban on mobile phones by Qualcomm Inc., a rare legal victory in a long-standing patent dispute with rival Broadcom Corp.

Judge Haldane Mayer on the U.S. Court of Appeals for the Federal Circuit granted a request by several mobile phone manufacturers and AT&T Inc.'s wireless division to stay the ban the federal government ordered in June.

The U.S. International Trade Commission barred imports of new mobile phone models with Qualcomm chips after determining that the company had violated a patent held by chipmaker Broadcom on battery power-saving technology. The White House refused to overturn the ban in August.

The ITC's ruling applied to chips that are used in high-end phones that can transmit video and data at high speeds. Mayer's decision Wednesday will allow carriers and manufacturers to introduce new phone models later this year.

The order applies only to the seven companies that sought to halt the ban: carriers AT&T and T-Mobile USA Inc. and handset makers Motorola Inc., Samsung Electronics Corp., LG Electronics, Kyocera Wireless Corp. and Sanyo Fisher Co.

Sprint Nextel Corp. was conspicuously missing from the order but a spokesman for the carrier and a Qualcomm attorney said the carrier could sell phones made by any of the manufacturers covered.

"We think this is an important decision," said Sprint Nextel spokesman Matt Sullivan. "(The ban) was not an appropriate remedy."

Sprint Nextel has also sidestepped the ban by selling phones that rely on alternative software. According to Qualcomm, those alternative designs do not infringe on Broadcom's patents.

Verizon Wireless avoided the ban by striking a licensing agreement in July with Broadcom.

Numerous companies that use Qualcomm chips in the cell phones they manufacture, including Motorola, Samsung and T-Mobile, appealed the ITC ruling. They argued that since Broadcom only filed its complaint against Qualcomm, the ITC did not have the authority to block imports by companies other than Qualcomm.

The judge agreed with the appealing companies and stayed the ITC's order pending their appeal.

"We are pleased that the Court of Appeals recognized the undeserved harm to parties who were not named in the lawsuit, and that our customers will continue to be able to introduce new products into the U.S. marketplace during the appeals process," said Alex H. Rogers, Qualcomm's senior vice president and legal counsel.

A Broadcom spokesman did not immediately respond to requests for comment.

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