Arm has reportedly cancelled Qualcomm's chip license but it won't stop the manufacture of Snapdragon X AI' PCs

Arm has finally thrown in the towel and notified Qualcomm that it will be cancelling its licence to produce chips using Arm technology within 60 days. Bloomberg claims to have seen documents from Arm detailing the move.

The dispute has been going on for some time, but if it is true, the consequences for Qualcomm could be catastrophic. Qualcomm's new Snapdragon X processors for PC laptops would be the most affected. Theoretically, if Qualcomm's licence was revoked, it would be forced to stop producing the Snapdragon X, and the Windows-on Arm AI PC, which has just begun, would collapse.

The licence cancellation is believed to be specific to Qualcomm chips that have custom core designs using the Arm ISA, or instruction set architecture. Snapdragon X, a Qualcomm-designed chip with custom CPU cores, is one example.

To be more accurate, the cores of the Snapdragon X were designed by Nuvia, a startup that Qualcomm acquired in 2021. The main point is that you can build an Arm-based processor in two different ways. The first is to license the Arm ISA, and design your compatible cores. The second is to purchase ready-made cores from Arm.

Qualcomm has used the first option with Snapdragon X. The licence cancellation would only apply to Qualcomm chips based upon Arm CPU core designs. The cancellation would not mean that Qualcomm could no longer produce any Arm chips, but only Arm chips with Qualcomm's own CPU core designs.

The cancellation would not stop Qualcomm from producing its custom-designed chips for phones for which it has a separate license. The dispute appears to be limited to the Snapdragon-X for PCs, laptops and tablets.

The entire mess can be traced to Nuvia's original acquisition of a licence for custom Arm cores targeted at servers and enterprise-level applications. Arm's beef with Qualcomm is that it is using this licence to produce chips that are clearly targeted towards laptops and client computers.

Guess what? A server license is cheaper than a clients licence. This is the dominant narrative surrounding a dispute which has not yet been fully publicized.

What will actually happen then? This fracas will make a lot of lawyers richer. It's not likely that Qualcomm would be forced to stop producing its Snapdragon X chip.

It's not a question about whether Qualcomm has to pay to continue making Snapdragon X, but rather how much. It's highly unlikely that Arm wants Qualcomm to abandon Snapdragon X. It wants more licensing fees.

Qualcomm has probably invested too much in this to just walk away. It will fight to minimize any fees or penalties, while continuing to make Snapdragon X chips. It's okay if it has to pay out eventually.

The most likely outcome is that the case will drag on in court for years, and eventually a settlement will be announced. By then, we will all forget how it all began.

It's hard to tell what impact this will have on PCs switching from Intel and AMD x86 processors to Arm chips. Even without the Arm-versus Qualcomm tussle a compelling Arm gaming PC was still many years away. This legal battle is unlikely to accelerate things, given Qualcomm is the main player pushing Arm on PCs.