After the EU "grandslammed" Qualcomm with a $1.2 billion fine (joining the FTC and Asian regulators in holding Qualcomm's conduct illegal), Qualcomm has finally had some good news to report: just in time for its earnings call, Qualcomm announced a new five-year license agreement with Samsung. In addition to the joint press release with Samsung, Qualcomm issued a press release in which it mentioned that "Samsung will be withdrawing its interventions in Qualcomm's appeal of the KFTC decision in the Seoul High Court."
The most interesting question would be whether Qualcomm had to substantially lower its fees and prices in order to get this deal done with Samsung. I can't imagine that Samsung wouldn't have used its leverage from Qualcomm's overall situation, including Broadcom's hostile takeover bid. This is probably a pretty good deal for Samsung. However, Qualcomm presumably wanted to avoid doing a deal on terms that would undermine its credibility with a view to rate-setting decisions that courts in different jurisdictions will have to make. Apparently there was a set of deal terms that both parties considered beneficial, and it allows both of them to focus on other issues.
What else does this new agreement mean for the pending lawsuits and ongoing antitrust proceedings?
It's unlikely that Samsung would now, after complaining about how Qualcomm's practices "directly harmed" the Korean electronics giant in two strategic business areas, suddenly file amicus briefs in support of Qualcomm. After all, Samsung will need leverage again when renewing the current deal in a few years' time. So Samsung will most likely play a neutral part and sit by idly and silently as regulators on three continents, Apple, and possibly other device makers (rumor has it that Huawei stopped paying royalties last year) are squaring off with Qualcomm in different venues.
Samsung is Korea's largest corporation (accounting for roughly 20% of GDP), but not its only one. Presumably the KFTC will continue to defend its decision in court, and other companies (such as LG) may still be very interested in the process. However, South Korea is now a less relevant "theater" in the worldwide Qualcomm antitrust war. Qualcomm is still in trouble in the U.S., the EU, and Taiwan. And it remains to be seen what will happen in China if it's true that Huawei was the device maker that halted its royalty payments.
In a nutshell, Qualcomm has one enemy less, but still a huge pile of problems--and still no major ally in court or in the antitrust arena.
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