Arm will cancel Qualcomm’s chip design licence in 60 days

Qualcomm just announced its new Snapdragon 8 Elite chip at its annual Snapdragon Summit in Maui, Hawaii and it’s already in jeopardy as a legal conflict between the company and Arm heats up.

Arm notified Qualcomm that it will terminate the company’s architectural licence in 60 days. That agreement allows Qualcomm to make the Oryon CPU cores that power the new Snapdragon 8 Elite, as well as the Snapdragon X chips in Copilot Plus PCs.

In a statement to PC World, Qualcomm called the move a “desperate ploy” and said it looked forward to resolving the issue at trial in December:

“This is more of the same from Arm – more unfounded threats designed to strongarm a longtime partner, interfere with our performance-leading CPUs, and increase royalty rates regardless of the broad rights under our architecture license. With a trial fast approaching in December, Arm’s desperate ploy appears to be an attempt to disrupt the legal process, and its claim for termination is completely baseless. We are confident that Qualcomm’s rights under its agreement with Arm will be affirmed. Arm’s anticompetitive conduct will not be tolerated.”

Arm declined requests to comment from both PC World and BNN Bloomberg.

The licence termination is the latest in an ongoing dispute between the companies. Arm, a U.K.-based company that licences the ARM processor designs used in almost every smartphone and a growing contingent of laptops, sued Qualcomm in the fall of 2022 for contract and trademark infringement. The company sought an injunction to force Qualcomm to destroy chip designs developed by Nuvia. Qualcomm acquired Nuvia in 2021 to beef up its ARM-based CPU designs.

Arm claims that Qualcomm breached its licence and that Nuvia’s chip designs created before the acquisition can’t be transferred without permission. Arm terminated Nuvia’s licences in February 2023.

BNN Bloomberg notes that both companies are increasingly pursuing strategies that put them at odds. Qualcomm, for example, is shifting from using ARM designs and focusing on its own work, most notably in computing. Arm is also pushing into computing while focusing on offering more complete chip designs companies can licence rather than letting companies make their own chip designs and only licensing the ARM instruction set.

If Arm follows through on the licence termination, Qualcomm wouldn’t be able to use its own designs with the ARM instruction set. However, it would still be able to licence Arm’s chip blueprints like the Cortex cores.

That would be a major blow to Qualcomm, which would face significant delays and waste work it’s already done. It’d also likely set the company back significantly — early benchmarks of the new Snapdragon 8 Elite chip show it’s much more competitive with Apple’s A-series iPhone chips than previous Snapdragon processors using Cortex CPUs. Similarly, the new Snapdragon X chips for PCs are going toe-to-toe with x86 chips from Intel and AMD in a way that prior Qualcomm PC chips haven’t been able to.

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Source: PC World, BNN Bloomberg