The big deal from this ruling from AAPL and QCOM's perspective is the terms and scope of the SEP licensing (now must be component-level). Before their recent negotiation, Apple was never even a licensee. These terms have been in place since prior to the first iPhone.
There is, IMO, some validity to the claim that Qualcomm's SEP portfolio enables a significantly different device. Their analogy refers to the ipod and the iphone, whose BOM in some cases differs by only the modem and yet it allows them to charge their customers an enormous markup. Arguably the value-add of that part and the patents it leverages must be a large portion of that markup, so perhaps it's fair to consider the device's cost with respect to the royalty.
> Their analogy refers to the ipod and the iphone, whose BOM in some cases differs by only the modem and yet it allows them to charge their customers an enormous markup. Arguably the value-add of that part and the patents it leverages must be a large portion of that markup, so perhaps it's fair to consider the device's cost with respect to the royalty.
What you're measuring there is the value of the standard and the cellular network as a whole. That includes not only Qualcomm's patents but also everybody else's wireless patents and the entire network infrastructure built by Verizon et al. Which is exactly why standards-essential patents are treated specially.
Moreover, the other obvious problem with it is that there are other devices with exactly the same modem technology in them which vary in price from $50 to $1000 based on processor speed, screen size, operating system, etc. and yet Qualcomm is claiming a percentage of the total device including the value of all the components they had nothing to do with.
There is, IMO, some validity to the claim that Qualcomm's SEP portfolio enables a significantly different device. Their analogy refers to the ipod and the iphone, whose BOM in some cases differs by only the modem and yet it allows them to charge their customers an enormous markup. Arguably the value-add of that part and the patents it leverages must be a large portion of that markup, so perhaps it's fair to consider the device's cost with respect to the royalty.