Qualcomm’s China Struggles Continue as It Fails to Reach Patent Deals.

http://www.wsj.com/articles/qualcomms-china-struggles-continue-1446852072


The article discusses the problems with holding onto a Patent. Qualcomm Inc. is trying to make deals with two companies, and the large drop in shares shows the struggles that they are having. The company has shown large decreases in revenue and this is due to a decrease in sales and manufactures stopped making royalty payments due to the cease in the patent. The loss of the patent has caused significant losses for Qualcomm Inc. To try and make a comeback, Qualcomm made a large payment of 975 million dollars for antitrust problems, but it did not help due to the fact they weren’t able to collect licensing revenues. The company is now beginning to enforce stricter agreements in order to obtain their correct amount of royalty payments, as well as having better negotiations. They need to do this because the majority of their income comes from royalties, which exceeds over 6 billion dollars. The two manufactures that Qualcomm is having issues with are Lenovo and Xiaomi. If the patents were still in place, the royalty money these companies both owe are very large. Once an agreement is done by Qualcomm to fix the patents, the companies holding out will have to pay them.