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September 1, 2022updated 02 Sep 2022 4:12am

Arm sues Qualcomm alleging license breach in $1.4bn Nuvia purchase

If successful, the lawsuit would be a blow to Qualcomm's ambitions in the PC market.

By Matthew Gooding

British chip designer Arm is taking one of its biggest partners, Qualcomm, to court, alleging that the company breached a licensing agreement by purchasing semiconductor start-up Nuvia.

Arm is suing chipmaker Qualcomm alleging a license breach. (Photo by G0d4ather/iStock)

If successful, the action could see all Nuvia designs destroyed, striking a blow to Qualcomm’s ambitions to grow its share of the PC market.

Why is Arm suing Qualcomm?

Qualcomm purchased a Nuvia for $1.4bn last year. Founded by former Apple and Google executives, the start-up is developing its own custom high-performance processor designs based on the Arm architecture.

This means it has different licensing terms with Arm than Qualcomm, which mainly deploys standard Arm designs in its chipsets. This is at the heart of Arm’s complaint, filed in the US district court of Delaware, which says Qualcomm has no rights to use the custom licenses bought by Nuvia.

The purchase by Qualcomm “caused Nuvia to breach its Arm licenses, leading Arm to terminate those licenses, in turn requiring Qualcomm and Nuvia to stop using and destroy any Arm-based technology developed under the licenses”, the complaint says.

Arm, which is currently owned by Japanese conglomerate SoftBank but is set to go public next year, is asking for all Nuvia designs to be destroyed and seeking damages from Qualcomm.

Tech Monitor has contacted Qualcomm for comment, but Ann Chaplin, Qualcomm’s general counsel, told Reuters: “Arm’s complaint ignores the fact that Qualcomm has broad, well-established license rights covering its custom-designed CPUs, and we are confident those rights will be affirmed.”

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The growing importance of Arm chips in the PC market

Qualcomm has long been reliant on Arm designs for its products, such as the Snapdragon range which is widely used in mobile devices.

Its acquisition of Nuvia was seen as a way of gaining a greater foothold in the PC market, which is dominated by chips from Intel and AMD built on Intel’s x86 architecture.

Arm’s low-power, high-performance architecture has ruled the roost in mobile devices for years, but has been less popular when it comes to PCs and servers. However, the signs are this could be changing, with Apple having successfully developed its own Arm-based chips for its MacBook computers, the M1 series, based on Arm architecture. These chips have delivered performance benefits compared to their Intel rivals.

In the server market, Arm-based chips from companies such as Ampere Technology are also gaining traction, and being deployed by the hyperscale cloud providers in their data centres.

By purchasing Nuvia, Qualcomm had hoped to accelerate the development of its own custom designs. Speaking to The Verge earlier this year, Qualcomm CEO Cristiano Amon said: “I made the acquisition of a company called Nuvia because we wanted to have the best CPU team in the market,” before adding that “you should expect Qualcomm aiming to take the leadership position in performance.”

Successful court action by Arm could put these ambitions in doubt.

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Read more: Google shuns Intel and AMD to select Arm chips for data centres

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