Qualcomm Sues Apple: Smart Move, or a Door to Intel? Asks Street
.Shares Qualcomm (QCOM) rose 27 cents, or a half percent, to $ 55.06, after the company announced yesterday after announcing Apple’s continuation (AAPL) for patent infringement and urging the International Trade Commission to ban IPhone import into the US
Today, there are strong disagreements over whether it was a good decision for Qualcomm. Some see society taking leverage, others see the prospect that Apple gets a kind of “shield” to completely shift the documents provided not only by Qualcomm but Intel (INTC).
Timothy Arcuri of Cowen & Co., which has an Outperform rating from Qualcomm, wrote that Qualcomm could consider a total loss of baseband market share on the iPhone.
But the general idea is to protect the current structure of its licensing activities:
Amit Daryanani, RBC Capital, which has a performance rating on Qualcomm shares, says you should prepare for a “long and nasty battle”, but “we do not think there is a source of alarm for investors,” he said. Will be the insignificant impact on the “current term” because action by the ITC can take from 16 to 18 months, he notes.
Daryanani believes that the “time is interesting,” since Apple “should be close to finalizing the design and components for iPhone 8 vendors,” implying that perhaps Qualcomm anticipates the loss of a larger Intel baseband exchange, this time.
Stay Rasgon with Bernstein, who has a Market Perform recommendation on Qualcomm notes that seeing an iPhone ban is “faster than a court” however “is enough ice, we do not expect new cases at additional pressure on AAPL leading to rules anytime “.
The tear notes, Qualcomm, would give Apple an “outlet” if they throw away all Intel chips, and thinks that this will not have much impact for now:
We are not surprised that QCOM take these measures1, but it seems unlikely to have a significant impact in the short to medium term, given the typical length of procedures (which may be qu’AAPL counts). More aggressive actions like eliminating chipsets would be much more drastic, but they also play into the meat of the recent regulatory box against QCOM (and perhaps more effective!); So far, the company said it was not considering that measure (in fact, they seem to do otherwise, which essentially gives AAPL an “exit” if they wish to eliminate INTC as a provider).
Tavis McCourt with Raymond James thinks this move is “smart” for Qualcomm and can be used as a lever:
It was the next logical step for Qualcomm and that it was an intelligent decision in our view to claim a violation of exclusive patents rather than standard essential patents (SEP).
With this approach, Apple can not claim that Qualcomm did not offer fair and reasonable and non-discriminatory (reasonable and non-discriminatory) conditions for the use of MS, but to defend itself against violations of these specific non-essential patents.
The good news is that the ICC is generally a jurisdiction that moves much faster than the district courts, so the case could be decided ahead of schedule.
The press release indicates that the case should be tried next year. We do not expect this to affect Qualcomm’s or Apple’s estimates. Our understanding is that this is a completely different case around non-EM, so a victory or a defeat in this case would have little impact on Apple’s September filing, but this case could certainly provide leverage for Call the apple at the negotiating table. In sum,