Qualcomm: The blow is not fine, while the business model

Summary: High-pass case landed is expected, fine nearly 1 billion U.S. dollars is also expected. But for Qualcomm, the biggest constraint and blow is not money, but business models. Qualcomm's monopoly has long been formed, and it has also been a Chinese handset company. But

The high-pass case was expected to fall, with a fine of nearly 1 billion dollars in anticipation. But for Qualcomm, the biggest constraint and blow is not money, but business models.

Qualcomm's monopoly has long been formed, and it has also been a Chinese handset company. However, the real use of monopoly position to harm the market outright, mainly after the introduction of the QRD programme in 2011.

QRD is an ecological strategy for Qualcomm, which is common in the business world. But it's different for it. Before Qualcomm is basically a sell a single processor, although its product line is very long, the bottom of a lot of patents.

QRD was originally a strategy to make MediaTek by MediaTek, and that was the solution. The industry is called "turnkey" projects. Its background is the main role of the black cell phone screen that MediaTek has achieved through this model.

But Qualcomm is a step too far ahead of MediaTek. It not only defines the solution of the processor, but also defines the whole machine. Because it has too many product modules, from 2G to 4G, from chipset, memory card, monitor, battery to software. Its baseband chipset is a basket.

Qualcomm uses the handset machine price as the basis which calculates the patent license fee, this strategy is very ruthless. Its purpose is to think of the mobile phone as it sells "whole chicken" stage, in fact, people as long as a chicken leg is enough.

Qualcomm artificially pushes up the cost of the global handset industry, which has many backwards-compatible patents that can be completely removed.

This strategy has made it difficult for outside companies with some patents to get into the Qualcomm-led mobile ecosystem, even if you open your own patents, Qualcomm bullies you, those cross licensing patents, you pay it, and it doesn't give you a reasonable price. Many times, mobile phone companies repeat their fees.

MediaTek's "turnkey" model was one of the reasons why Nokia and Motorola were reduced. It does reduce industrial barriers. When Qualcomm first adopted it, we had to admit that it had a lot to do with the popularity of the global mobile Internet, with the QRD model at least partially shortening the industry cycle.

But when this model goes to the extreme-bundle more modules, cover high school low all product line, the whole industry chain has appeared morbid: Arm Camp processor Enterprise, basically only it one eat meat, other basic can only drink soup, sometimes even soup also can't drink. Over the past few years, European and American mobile processor companies have been sold more than last year, China has been more than the integration of the mainland.

In fact, this model reflects the crisis of Qualcomm. 2G transition 3G era, although it ruled the 3G core patents, but many 2G patent expired, leading to the high Qualcomm partial monopoly was disintegrated, QRD model is also a symbol of the death throes.

As time progressed, Qualcomm did become the king of the 3G era. This era is the global communications industry standards of chaos, decentralization, many Qualcomm modules, covering a number of standards, who want to break its monopoly, it is too difficult. The two years of MediaTek's passivity are behind the Qualcomm trick. To be aware, Qualcomm was in the grip of the global cdma10%~20% core patent, penetration of the 3G communication standards at the bottom.

Over the past few years, Qualcomm's revenues, net profits and stock prices have been terrific. A chip design company, revenue unexpectedly surpassed many chip manufacturing giants, is not a normal industry.

Qualcomm 3G is in the ascendant, the main background is the spread of international standards, and the patent is too concentrated in its hands. When the global transition from the 3G era to the 4G era. International standards have begun to merge into two major systems, while patent pools are relatively fragmented, which is tantamount to disrupting some of the advantages of Qualcomm. Although it still has a lot of discourse power, but the excessive QRD mode has been difficult to continue, began to hit the wall.

It is not normal for a patent to be highly concentrated in the market of individual enterprises. The convergence of standards in the 4G era began to give the power of speech to those scattered patents, and LTE gave many companies a chance to circumvent some of the barriers.

High-pass pressure is just beginning. The future 5G era, more emphasis on the unity of global standards, the dispersion of patents, only this pattern, can really build a vast network of things covering everyone, people, things, those who used to eat 3g4g patent large enterprises, will encounter fierce challenges.

This topic, I once threw to Huawei wireless network product line CMO Yang Shubin, he replied last year: "For vested interests, it is painful to break the existing pattern." However, we also know that the ICT industry as a whole is developing very quickly, and as a company, it will be abandoned by this era if it does not accept the change. ”

I hope Qualcomm knows.