Qualcomm mobile royalty row hots up

Leading mobile phone makers Samsung and LG can soon stop paying some royalties to US chip developer Qualcomm, Korea's communications minister told a local newspaper today. However, Qualcomm has denied similar claims twice before. 

"As far as we know, the royalty deals between Qualcomm and our main mobile phone producers come to an end this August for CDMA cellphones shipped to the local market," Korea's Information and Communication Minister, Rho Jun-hyong, told the Korea Times. 

Earlier this month, Qualcomm categorically denied similar claims in a statement to vnunet.com.

Reports that Korean mobile phone makers' royalty payments to Qualcomm will cease in August 2006 for domestic sales, and in 2008 for international sales, are not correct, according to Christine Trimble, Qualcomm's senior director of corporate communications.

"The royalty obligations that Korean manufacturers have with Qualcomm will continue beyond such dates (for both domestic Korean sales and exports), and there is no date on which a licence under all of Qualcomm's patents becomes royalty free," she said.

Contrary to the Korea Times report, vnunet.com has learned that the royalties Qualcomm collects in Korea could actually increase significantly in August because the company will no longer need to pay 20 per cent of them to a government research institute.

Qualcomm has not confirmed this, but earlier financial filings and statements suggest that the company could generate as much as an additional $300m this fiscal year from the end of royalty-sharing agreements.