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Monday, December 29, 2008

Samsung doesn't like to pay royalties

As the company is the biggest royalty customer for both Qualcomm and Sandisk, who can blame them.

According to an article in the eetimes, Samsung is developing their own "4g" chips. These are chips for WiMax and LTE (long term evolution) which are wireless broadband technologies on the come. Samsung has done this before -- with 3G in fact. They said they were going to make their own chips, they did, they used it as a negotiating chip with Qualcomm to get their royalty rates lowered somewhat.

It's not much of a direct threat to Qualcomm at present, though the stock tends to get turbulent when people start thinking about the impact of a 20+% customer paying them less. Samsung is sending a message to Qualcomm that they're expecting to pay lower royalty rates in the future.

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