Qualcomm protects patents with new corporate structure

Qualcomm announced plans to modify its corporate structure in order to hive off its patent-related activities. The company said this will enhance its ability to quickly deliver products to customers, while further protecting and insulating its valuable patent portfolio from any claims resulting from activities by portions of the company other than the Qualcomm Technology Licensing Division (QTL). The company stressed that this would not result in a spin-off or sale of either part of the business, nor does it come in response to any pending patent litigation. 

The new corporate structure will feature the parent company, Qualcomm Incorporated, which includes QTL and corporate functions, as well as most of Qualcomm's patent portfolio; and a new wholly owned subsidiary, Qualcomm Technologies Inc (QTI), which will operate substantially all of Qualcomm's research and development activities, as well as product and services businesses, including its semiconductor business, QCT. 

The restructuring also anticipates more use of open source software at QTI in future and aims to ensure that such activities do not result in the licensing of any of Qualcomm's patents, including its 3G and 4G patents. Under the new structure, QTI and its subsidiaries will own patents specifically developed for purposes of providing open source software contributions by QTI and its subsidiaries, whereas substantially all of the remainder of the company's patent portfolio will continue to be owned by Qualcomm Incorporated. QTI and its subsidiaries will have no rights to grant licences or other rights to patents held by Qualcomm Incorporated.

There will be no changes to the intellectual property that is currently owned by Qualcomm Innovation Center, which works closely with the open source community. Qualcomm expects that the new corporate structure will become effective during the first fiscal quarter of 2013.