Wifi Revolution

Wireless chip maker Qualcomm (News - Alert) Inc., has announced the availability of new chips that have been sampled by customers as well as announced that they expect to have a hardware and software work-around for the 686 patent commercially available in handsets before the end of the first calendar quarter of 2008.

 

Qualcomm also said that it is evaluating options, including stays and appeals after Federal District Judge, James V. Selna, ruled on Monday that Qualcomm must immediately stop selling third-generation, or 3G, WCDMA cellular chips that are seen to infringe on patents of rival Broadcom (News - Alert) Corp.

 

A Santa Ana, California, court ruled last year that Qualcomm infringed three Broadcom patents.

 

However, the recent ruling provides a “sunset” provision that stays the order until Jan. 31, 2009 for QChat and 1x/EV-DO products that were found to infringe any of the three patents by providing Qualcomm a limited license, subject to an ongoing royalty payment.

 

According to the company, this license is limited to products that were sold to customers on or before the jury verdict was delivered on May 29, 2007. The '010 and '317 patents apply only to Qualcomm's QChat and 1x/EV-DO products.

 

At present, San Diego, California based Qualcomm is continuing the development of work-around solutions for the '010 and '317 patents.

 

Qualcomm is expected to release a fresh estimate of its financial standing when it reports fiscal first-quarter results on Jan. 23. According to a Business Week report, the company will have to account not only for lost sales but also for royalty rates of 4.5 percent and 6 percent, respectively, on two of the three patents.

 

The report also suggests that cell-phone makers will also feel the impact. Richard Windsor, analyst at Nomura Securities, predicts that cell-phone makers Nokia and Sony Ericsson (News - Alert) could grab market share in the U.S. from LG and Samsung in early 2008 as a result of a transition to non-infringing chips.

 

In addition, many Qualcomm customers may experience delays in releasing new phone designs.

 

 

 

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