Arm is canceling Qualcomm's chip design license • Hacker News Board

Re: Arm is canceling Qualcomm's chip design license

#461

Post by ajross » Fri, Oct 25, 2024, 3:03 PM UTC

michaelt wrote: post #455

ajross wrote: post #452

Earlier quoted context omitted.

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…

That's true enough, but you can refuse to license them for their next product, which is (or should be) incentive enough. Selling silicon IP blocks is a very mature industry, ARM is one of many such companies, and no one else is out there throwing doomsday bombs like this. Really, this is extremely weird.

Re: Arm is canceling Qualcomm's chip design license

#462

Post by klelatti » Fri, Oct 25, 2024, 3:08 PM UTC

manarth wrote: post #460

michaelt wrote: post #449

As 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 Nuv…

Not quite. Qualcomm had an existing architecture license but with lower royalty rates than Nuvia’s. They claim they can sell Nuvia derived designs under that license with it’s lower royalty rates.

Re: Arm is canceling Qualcomm's chip design license

#463

Post by michaelt » Fri, Oct 25, 2024, 3:09 PM UTC

jauntywundrkind wrote: post #456

michaelt wrote: post #449

As 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.'

The linked article says: "However, says Arm, it appeared from subsequent press reports that Qualcomm may not have destroyed the core designs and still intended to use the blueprints and technology it acquired with Nuvia"

Obviously it's hard to know for sure - it could even be an Anthony Levandowski type situation, where an ambitious employee passes off an unauthorised personal copy as their own work without Qualcomm realising.

Re: Arm is canceling Qualcomm's chip design license

#464

Post by klelatti » Fri, Oct 25, 2024, 3:10 PM UTC

jauntywundrkind wrote: post #456

michaelt wrote: post #449

As 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.'

Reasonably sure that Qualcomm aren’t claiming their X Elite cores are free of Nuvia created IP. Rather that Arm can’t prevent the transfer of that IP to Qualcomm.

Re: Arm is canceling Qualcomm's chip design license

#465

Post by klelatti » Fri, Oct 25, 2024, 3:13 PM UTC

ajross wrote: post #461

michaelt wrote: post #455

Earlier quoted context omitted.

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…

That's true enough, but you can refuse to license them for their next product, which is (or should be) incentive enough. Selling silicon IP blocks is a very mature industry, ARM is one of many such companies, and no one else is out there throwing doomsday bombs like this. Really, this is extremely weird.

> but you can refuse to license them for their next product

That might not be legally possible - or deemed to be anticompetitive. Cancelling an existing license if a firm has breached it would probably be less problematic.

Re: Arm is canceling Qualcomm's chip design license

#466

Post by manarth » Fri, Oct 25, 2024, 3:15 PM UTC

klelatti wrote: post #462

manarth wrote: post #460

Earlier quoted context omitted.

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 Nuv…

Not quite. Qualcomm had an existing architecture license but with lower royalty rates than Nuvia’s. They claim they can sell Nuvia derived designs under that license with it’s lower royalty rates.

Thanks for the clarification! :-)

Re: Arm is canceling Qualcomm's chip design license

#467

Post by michaelt » Fri, Oct 25, 2024, 3:30 PM UTC

manarth wrote: post #460

michaelt wrote: post #449

As 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 Nuv…

Maybe? The article I quoted was a big vague on that point, only mentioning "chip blueprints" which is pretty ambiguous.

However, some sources [1] say the "architectural license" is "higher license fee, fewer use constraints, greater commercial and technical interaction"

There are often two parts to the cost of these licenses - an upfront fee, and a per-chip royalty. So it could be both at the same time: Nuvia, who made few chips, might have negotiated a lower upfront fee and a higher per-chip royalty. Whereas Qualcomm, who make lots of chips, might have prioritised a lower per-chip royalty, even if the upfront fee was greater.

[1] https://www.anandtech.com/show/7112/the-arm-diaries-part-1-h...

Re: Arm is canceling Qualcomm's chip design license

#468

Post by initramfs » Fri, Oct 25, 2024, 4:14 PM UTC

alephnerd wrote: post #454

initramfs wrote: post #448

ARM 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.

I understand ARM is not becoming a foundry (at least anytime soon, which I will explain in a second). First, I said they are becoming a chipmaker like Intel because they have two of three things to make chips- an architecture, and physical core IP (POP) https://www.arm.com/products/silicon-ip-physical/pop-ip. They are making chips at all three foundries, but obviously don't own physical fabs. Softbank has 46 trillion in assets, with over 57.8 billion in operating income. What's stopping Softbank from making an offer to buy a majority stake in a Japanese foundry such as Rapidus (2nm) and other EUV equipment, such as Lasertec? https://semiwiki.com/forum/index.php?threads/shared-pain-sha... Ultimately, one starts to question, whether Qualcomms's interest in producing more consumer laptop chips is really competitive with the offerings by AMD and Intel, and whether this is really the best use of foundry space when foundries producing chips could be one day used against an amphibious assault on Formosa.

My point is that the commercial lawsuits between Qualcomm and ARM are just one part of a larger geopolitical issue- x86 lost the mobile market 20 years ago- the only reason Intel is surviving is national security- they could have been bankrupt had they not been propped up by a pre-emptive Defense Production Act. Consumers benefit because now they have the choice between more ARM software and x86 products, but I think that is just a short term benefit. Eventually the architecture cuts off support for old software, such as x86-32 bit, and now with X86S, they are only supporting 64 bit. So in the long term, it's better to have options. WINE was developed because of a fear of repeating the Irish Potato Famine ( a mono culture: https://gitlab.winehq.org/wine/wine/-/wikis/Importance-of-Wi...), in economic terms. In other words, just because Intel might not want to sell 32 bit chips anymore, doesn't mean others might not want/need to use some application that only exists on one platform (and all the engineers retired- with lost code/unported code).

There's an AI bubble: https://www.marketwatch.com/story/the-ai-bubble-is-looking-w... When a number of companies get investments and start to produce chips that add little extra value- slightly faster chips in lower power with 10 different architectures than run windows 11, then there is less justification to continue investing in companies that do not produce interesting new hardware because the end result is that they are being shaped by windows 11, rather than a unique feature- automotive efficiency for in car apps, sure, but laptops that run Oryon that are hard to boot linux aren't any more interesting than an x86S processor that can only boot linux 6.8 etc.

Re: Arm is canceling Qualcomm's chip design license

#469

Post by adrian_b » Fri, Oct 25, 2024, 4:54 PM UTC

manarth wrote: post #460

michaelt wrote: post #449

As 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 Nuv…

No. Both Qualcomm and Nuvia had an ALA = "Architecture License Agreement". Qualcomm had also licensed many ARM-designed cores separately.

An ALA signed with ARM gives the right to design CPU cores that are conformant to the Arm Architecture specification. When the CPU cores that are designed thus are sold, a royalty must be paid to ARM.

The royalties negotiated by Nuvia were much higher than those negotiated by Qualcomm, presumably based on the fact that Qualcomm sells a huge number of CPU cores, while Nuvia was expected to sell few, if any.

When Qualcomm has bought Nuvia, ARM has requested that Qualcomm shall pay the royalties specified by the Nuvia ALA, for any CPU cores that are derived in any way from work done at Nuvia. Qualcomm has refused, claiming that they should pay the smaller royalties specified by the Qualcomm ALA.

Then ARM has cancelled the Nuvia ALA, so they claim that any cores designed by Qualcomm that are derived from work done at Nuvia are unlicensed, so Qualcomm must stop any such design work, destroy all design data and obviously stop selling any products containing such CPU cores.

The trial date is in December and ARM has given an advance notice that they will also cancel the Qualcomm ALA some time shortly after the trial. So this will have no effect for now, it is just a means to put more pressure on Qualcomm, so they might accept a settlement before the trial.

Qualcomm buying Nuvia should increase the revenue for ARM from the work done at Nuvia, because Qualcomm will sell far more CPU cores than Nuvia, so even with smaller royalties the revenue for ARM will be greater.

Therefore the reason why ARM does not accept this deal is because in parallel their revenue from the ARM-designed cores licensed to Qualcomm would drop soon to zero. Qualcomm has announced that they will replace the ARM-designed cores in all their products, from smartphones and laptops to automotive CPUs.

Re: Arm is canceling Qualcomm's chip design license

#470

Post by initramfs » Fri, Oct 25, 2024, 7:02 PM UTC

starspangled wrote: post #413

ywvcbk wrote: post #409

Earlier quoted context omitted.

> RISC-V We’d just get a bunch of proprietary cores which might not even be compatible with each other due to extensions. Companies like Qualcomm would have zero incentives to share their designs with anyone. ARM is not perfect but it at least guarantees some minimal equal playing field. > Afaik, ARM also licenses ready-to-go cores Which is the core of Qualcomm’s business. All their phone chips are based on Cortex. O…

> We’d just get a bunch of proprietary cores which might not even be compatible with each other due to extensions. No different than ARM. Apple has matrix extensions that others don't, for example. The ecosystem (e.g., Linux and OSS) pressure will strongly encourage compatible subsets however. There is some concern about RISCV fragmentation hell that ARM used to suffer from, but a least in the Linux-capable CPU space…

> Companies like Qualcomm would have zero incentives to share their designs with anyone.

And yet, that's what linux did in 1991- they shared the code, lowering the cost of buying an operating system. I wouldn't say there is zero incentive, but it certainly lowers the incentive without a profitable complementary hardware implementation that can be sold for less than the proprietary isa when there is a royalty free license allows the manufacturer/fab designer "mask rights" to get a small margin within the difference of the foundry/ISA proprietary core competitor.