Fallout From The Ban Of Qualcomm Chips

The recent partial ban on importing Qualcomm chips will reverbrate throughout the industry and have a significant impact on all players, if the decision stands as is. FT has a consise round-up of the major winners and losers:

The Losers: LG and Samsung are seen as the biggest losers from this decision (apart from Qualcomm, of course). They have a good marketshare of high-end phones and mostly use Qualcomm chips, so will need a major effort to get around the ban. Kyocera and Sanyo also use Qualcomm chips, and Motorola was planning to use Qualcomm chips in its next range of handsets. Some analysts have also expressed concern that 3G will suffer from the dispute, since the increased uncertainty could see some industry members moving to other technologies like WiMAX.

The Winners: Nokia and Sony Ericsson gain from the ban because they don’t use Qualcomm chips. They also don’t have a very good share of the US market, so could be looking at this to give them a boost. Apple is also a winner — it doesn’t use Qualcomm chips and its main competitors are high-end phones from Samsung and LG.

Qualcomm’s Options: Qualcomm has four options open to it, according to FT. It could try for a presidential veto (which is historically rare), it could appeal (which could take years and require an emergency stay of the judgement), develop a work-around (which would also take time and Broadcom could challenge the legality of the work-around) or it could settle with Broadcom. Qualcomm claims a settlement would be “destructive to our business model” — which is getting other companies to pay for its IP rather than paying other companies for their IP.