Meanwhile RISC-V slowly but surely picks up momentum.
Arm is canceling Qualcomm's chip design license
451–460 of 480 posts
Re: Arm is canceling Qualcomm's chip design license
#452As I understand it [1] the context is: Qualcomm had one type of ARM license, granting them one type of IP at one royalty rate. A startup called "Nuvia" had a different type of ARM license, granting them more IP but at a higher royalty rate. Nuvia built their own cores based on the extra IP. Then Qualcomm brought Nuvia - and they think they should keep the IP from the Nuvia license, but keep paying the lower royalty r…
That's all routine though. This kind of license negotiation happens all the time, in every industry. Companies need to work together to sell their products. And almost always it ends up just being rolled into whatever the next contract they write is. Very occasionally, it ends up in court and one side settles once it's clear which direction the wind is blowing.
But getting to the point where a supplier of critical infrastructure pulls a figurative knife on one of their biggest customers for no particularly obvious reason is just insane. ARM Ltd. absolutely loses here (Qualcomm does too, obviously), in pretty much any analysis. Their other licensees are watching carefully and thinking hard about future product directions.
Re: Arm is canceling Qualcomm's chip design license
#453As I understand it [1] the context is: Qualcomm had one type of ARM license, granting them one type of IP at one royalty rate. A startup called "Nuvia" had a different type of ARM license, granting them more IP but at a higher royalty rate. Nuvia built their own cores based on the extra IP. Then Qualcomm brought Nuvia - and they think they should keep the IP from the Nuvia license, but keep paying the lower royalty r…
Do you think that Qualcomm bought Nuvia with the expectation that Nuvia's royalty agreement would remain intact? Perhaps they wouldn't have paid as much, or purchased them at all if the license is able to be terminated in that way.
Re: Arm is canceling Qualcomm's chip design license
#454ARM is owned by an investment bank, SoftBank. It operates kind of like Goldman Sachs. ARM is becoming a chipmaker, just like Intel. But Intels' CHIP grant is more similar to a pre-emptive 2008-era bailout of the banks (TARP), for being "too big to fail." (because it makes defense chips) https://irrationalanalysis.substack.com/p/arms-chernobyl-mom...
ARM is not becoming a foundry. Almost no one wants to become a foundry because the margins are too low.
This is why they are subsidized for tens of billions of dollars by countries all over the world.
Re: Arm is canceling Qualcomm's chip design license
#455As I understand it [1] the context is: Qualcomm had one type of ARM license, granting them one type of IP at one royalty rate. A startup called "Nuvia" had a different type of ARM license, granting them more IP but at a higher royalty rate. Nuvia built their own cores based on the extra IP. Then Qualcomm brought Nuvia - and they think they should keep the IP from the Nuvia license, but keep paying the lower royalty r…
That's all routine though. This kind of license negotiation happens all the time, in every industry. Companies need to work together to sell their products. And almost always it ends up just being rolled into whatever the next contract they write is. Very occasionally, it ends up in court and one side settles once it's clear which direction the wind is blowing. But getting to the point where a supplier of critical in…
See, this is one of the downsides of running an IP based business.
If you're selling physical chips and customer decides not to pay for their last shipment, you stop sending them chips. No need to get the courts involved; the customer can pay, negotiate, or do without.
But when you're selling IP and a customer decides not to pay? You can't stop them making chips using your IP, except by going through the courts. And when you do, people think you're "pulling a figurative knife on one of your biggest customers for no reason"
Re: Arm is canceling Qualcomm's chip design license
#456As I understand it [1] the context is: Qualcomm had one type of ARM license, granting them one type of IP at one royalty rate. A startup called "Nuvia" had a different type of ARM license, granting them more IP but at a higher royalty rate. Nuvia built their own cores based on the extra IP. Then Qualcomm brought Nuvia - and they think they should keep the IP from the Nuvia license, but keep paying the lower royalty r…
> and they think they should keep the IP from the Nuvia license
Incorrect according to Qualcomm. They claim Snapdragon X Elite & other cores are from scratch rebuilds, not using any of the design used for Nuvia.
They did however use engineers who had designed Nuvia. So there may be a noted resemblance in places. Latest Tech Poutine: 'you can't delete your mind.'
Re: Arm is canceling Qualcomm's chip design license
#457Meanwhile RISC-V slowly but surely picks up momentum.
It’s getting extremely tiresome to see RISC-V comments in every thread about this. It’s unnecessary and irrelevant.
Re: Arm is canceling Qualcomm's chip design license
#458As I understand it [1] the context is: Qualcomm had one type of ARM license, granting them one type of IP at one royalty rate. A startup called "Nuvia" had a different type of ARM license, granting them more IP but at a higher royalty rate. Nuvia built their own cores based on the extra IP. Then Qualcomm brought Nuvia - and they think they should keep the IP from the Nuvia license, but keep paying the lower royalty r…
Do you think that Qualcomm bought Nuvia with the expectation that Nuvia's royalty agreement would remain intact? Perhaps they wouldn't have paid as much, or purchased them at all if the license is able to be terminated in that way.
I have no idea of the specifics of Nuvia's license.
But it's totally common for corporations to make value-destroying acquisitions. Some research suggests 60%-90% of mergers actually reduce shareholder value. Look at the HP/Autonomy acquisition, for example - where the "due diligence" managed to overlook a $5 billion black hole in a $10 billion deal. And how often have we seen a big tech co acquire a startup only to shut it down?
Mergers only seem rational because once a mistake is set in stone, the CEO usually has to put a brave face on it and declare it a big success.
I could certainly believe during the acquisition process that the specifics of Nuvia's license were overlooked, or not fully understood by the person who read them.
Re: Arm is canceling Qualcomm's chip design license
#459As I understand it [1] the context is: Qualcomm had one type of ARM license, granting them one type of IP at one royalty rate. A startup called "Nuvia" had a different type of ARM license, granting them more IP but at a higher royalty rate. Nuvia built their own cores based on the extra IP. Then Qualcomm brought Nuvia - and they think they should keep the IP from the Nuvia license, but keep paying the lower royalty r…
Do you think that Qualcomm bought Nuvia with the expectation that Nuvia's royalty agreement would remain intact? Perhaps they wouldn't have paid as much, or purchased them at all if the license is able to be terminated in that way.
Then, they should have done their homework because any transferability clause would be in Nuvia’s licensing agreement.
Or maybe there is no such language in the contract and Arm is over-extending, but that sounds unlikely.
Re: Arm is canceling Qualcomm's chip design license
#460As I understand it [1] the context is: Qualcomm had one type of ARM license, granting them one type of IP at one royalty rate. A startup called "Nuvia" had a different type of ARM license, granting them more IP but at a higher royalty rate. Nuvia built their own cores based on the extra IP. Then Qualcomm brought Nuvia - and they think they should keep the IP from the Nuvia license, but keep paying the lower royalty r…
My understanding is that it's the other way around.
- Qualcom has a "Technology license". Because ARM design the entire chip under that license, ARM charge a premium royalty.
- Nuvia had an "Architectural licence" (the more basic licence). Nuvia then had to design the chip around that foundation architecture (i.e. Nuvia did more work). The architectural license has a lower royalty.
Qualcom decided they were using Nuvia chips, and therefore should pay Nuvia's lower royalty rate.
ARM decided that Nuvia's chips were more or less ARM technology chips, or possibly that Nuvia's license couldn't be transferred, and therefore the higher royalty rate applied.