Despite Arm

Key Takeaways

Arm won’t destroy laptops, outcome favors consumers and companies launching Snapdragon X Elite laptops.
Lawsuit likely ends in a monetary agreement between Arm and Qualcomm.
Future of Arm impacted by ability to create competitor, lawsuit outcome critical for industry.

It’s no secret that Arm has been on a little bit of a warpath when it comes to Qualcomm’s Snapdragon X Elite. The company has gone so far as to say that it wants all of the laptops destroyed, while also saying that Qualcomm owes the company a lot of money for going against its licensing agreements. I’m not worried about the outcome of the lawsuits though, and you shouldn’t be either.

To give a brief overview of the situation, Qualcomm purchased Nuvia, a start-up developing Arm-compatible custom cores aimed at servers. After Qualcomm made that purchase, Arm claims that the cores Qualcomm calls “Oryon” are iterations upon those initial designs. Arm claims to have given Nuvia “substantial, crucial, and individualized support” in making those cores, which in effect, means that Arm helped to create its own competitor given that those cores are why Qualcomm will be using fewer off-the-shelf Arm cores. Arm also says that Qualcomm would have needed permission to transfer and use Nuvia’s designs.

In rebuttal, Qualcomm argues that its broader license allows it to continue developing custom-designed CPUs using Arm’s architecture. In a statement to The Verge in 2022, Qualcomm’s general counsel Ann Chaplin said “Arm’s complaint ignores the fact that Qualcomm has broad, well-established license rights covering its custom-designed CPU’s, and we are confident those rights will be affirmed.”

No matter what happens, I’m not worried about the future of Snapdragon X Elite

Nobody’s laptops are getting destroyed

No matter what happens, I can’t see a full-scale recall that requires the destruction of Snapdragon X Elite laptops, and I think that the myriad of companies launching laptops with this SoC proves it. It would be a messy, not to mention expensive endeavor, and no matter what, all this boils down to one thing: money.

Arm recently went public, putting the company in a position where it now discloses all of its financials. Not only that, but it has a fiduciary duty to do right by its shareholders, meaning that it should continue to try and create value for the company in any way that it can. This includes chasing down anything that the company perceives to be a violation of its IP in order to claw back expected lost revenue.

From that perspective, there are two ways that this lawsuit goes. Arm has been seeking an injunction since September 2022, and if it were granted, then laptops with the SoC would no longer be sold. Consumers who still have devices won’t have to give back their devices. We’ve actually seen a recent example of this, where Apple Watch models, the Series 9 and Ultra 2, were briefly banned in the US thanks to an accusation of patent violation by Masimo. Apple has been fighting it tooth and nail, but in the meantime, you can purchase those devices without pulse oximetry in the United States.

To make that clear, consumers who had Apple Watches that violated that patent did not need to be recalled. In fact, devices with a model number not ending with LW/A were completely fine and could still continue to measure Blood Oxygen levels. Consumers kept their devices, the feature kept working, and Apple is now working things out in the courts with Masimo. Arm will have an uphill battle actually getting any Snapdragon X Elite laptops destroyed once they’re in the hands of consumers. That means they hope to either eventually get a big bag of money from Qualcomm, or both companies will come to an agreement.

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A big bag of money will transfer hands, and then it’ll all be over

Arm will likely get a payout, and then we’ll all forget about it

As tends to be the case with any big lawsuit, it’s likely that both companies will resolve this with some kind of monetary component keeping both sides happy. Arm sees Qualcomm as having violated its license, Qualcomm doesn’t think it did, and one company will likely just pay the other to resolve the matter. In essence, at some point, everyone will just move on and we’ll more or less forget that this situation even happened.

With that said, it’s clear why Arm has a problem. As already stated, assuming what the company said is accurate, it helped to create its own competitor through the help that it gave to Nuvia. Why would anyone use Arm’s off-the-shelf Cortex cores if Qualcomm’s Oryon cores perform better? It’s a tough situation to be in for Arm, and it also affects the future of the company. That’s why Arm is suing one of its biggest customers: it’s that important.

Whatever happens as a result of this lawsuit will likely have massive ramifications on the industry, assuming that there isn’t just a settlement that wraps up the entire thing. With that said, customers will undoubtedly be fine, and there’s no real reason to worry if you’re considering picking up any of the Snapdragon X Elite laptops that have launched.