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NVIDIA goes Lawyers Out on Samsung and Qualcomm, Is this really all about Terga?

by on08 September 2014 3095 times

On Friday the big news was that NVIDIA had launched two separate suits against Samsung and Qualcomm for patent infringement (International Trade Commission (ITC) and the US District Court in Delaware). In the suits NVIDIA claims that the two companies have willfully infringed on their patented GPU technology and (of course) they would like to start banning devices. So far the list includes the yet to be released Note 4 and Note Edge. The patents in question appear to be Patent Nos. 6198488, 6992667, 7038685, 7015913, 6697063, 7209140 and 6690372.

The complaint covers any SoC that contains Qualcomm’s Adreno, ARM’s Mali or Imagination’s PowerVR graphics architectures or any SoC on the market. According to NVIDIA they chose to push for this drastic measure after Samsung refused to pay licensing fees for the technology. Samsung, for their part, are claiming that the license to use the technology comes with the purchase of the hardware. This defense actually has some merit and was used successfully by Apple in more than one case. It falls under the claim that if you are already charging a manufacturer a licensing fee you should not be able to charge the buyer a second specific one. If this defense will work or not is yet to be seen, so far Apple has not managed to have the same “luck” as Apple when it comes to patents.

Since Friday a number of articles have come out claiming that NVIDIA is not a company that head to court on a whim. The last time they really went lawyers out was against Intel where they won a $1.5 Billion settlement and managed a patent sharing deal. The suit was the result of Intel claiming that NVIDIA could not make chipsets for their processor. In this case the cause might be a little less transparent.

NVIDIA has had aspirations of entering the CPU market for a number of years. In the lead up to the Tegra there were plans to push out it out as an x86 SoC instead of an ARM based one. However, NVIDIA lacked an x86 license to pull this one off. They sought multiple solutions for this including agreements with Intel, AMD and a few other companies that maintained x86 licenses. All of these efforts failed and they ended up pushing out the ARM based chip we know.

Tegra also failed to gain larger market acceptance due to some initial issues with the way the SoC performed when combined with other required hardware (Wireless and Cellular radios). This has led to the Tegra slowly falling off the map as a player in the mobile market. Where NVIDIA boasted of large number of design wins the numbers have fallen off drastically even though the technology behind the Tegra has improved. In two cases NVIDIA trusted a large partner (Microsoft) to help them push the performance of Tegra to the world (the ZuneHD and SurfaceRT). Both times Microsoft failed to help them in any measurable way and might have hurt them due to the poor sales of the devices in question.

In other words, this suit could be about leveling the playing field and attempting to remove some of the players in the near term. The angle would be for a higher licensing rate from Samsung and Qualcomm and to perhaps bully their way into adopting Tegra for a certain number of products. All this would be based on the threat of a ban of high demand products. We think that a ban is unlikely although with the way things have gone for Samsung lately it is still a possibility. In the meantime this move will not help NVIDIA push Tegra to the market, but it could help to offset some of the losses behind it. It will be interesting to keep an eye on this one and see what comes out from both suits.

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Last modified on 08 September 2014
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