Qualcomm's tricky licensing deal prevented Samsung from selling its own Exynos chipsets

According to South Korea’s Fair Trade Commission, Qualcomm allegedly blocked Samsung from selling its own Exynos chipsets to other manufacturers. This happened thanks to a patent licensing deal between the two companies which dates back to 1993 and is the reason why we find few smartphones powered by Samsung’s Exynos chipsets today.

ZDNet points out that the deal was signed at a time when chipsets did not pack-in modems which is why Samsung had no choice but to tie up with Qualcomm (using certain CDMA patents) and became a victim of patent abuse, when the trends changed.

Circa 2011 when chipsets with modems, GPUs and applications processors started to get packaged together, Samsung did go back to Qualcomm to get the terms of the deal changed.

It is here where Qualcomm is said to have taken advantage of the Korean tech giant and told Samsung that buyers of its chipset or Samsung should pay it licensing fees, to which Samsung agreed. Thanks to the deal Samsung or the smartphone maker would have to pay Qualcomm for using its CDMA patents in its Exynos chips which is why nobody but Samsung uses Exynos today.

According to the trade watchdog, Qualcomm’s patents fall under standard essential patents that must be licensed in fair terms. This comes after a $865 million fine against Qualcomm last December which was thrown at US chip giant for patent abuse.

Samsung also manufactures a multitude of Qualcomm chipsets which is where it appeared to have a win win situation. It was only early this year where Samsung managed to get something positive out of the deal by having first dibs on the upcoming Snapdragon 835 chipset which is also manufactured by Samsung using the 10nm process.

South Korea’s Fair Trade Commission is not the only one to go after Qualcomm. iPhone maker Apple too slapped a $1 billion lawsuit against Qualcomm accusing the chip maker of resorting to anti-competitive tactics to maintain a monopoly over key semiconductors in mobile phones.