Monday, October 28th 2019

GLOBALFOUNDRIES and TSMC Announce Resolution of Global Disputes Through Patent Cross-Licensing

GLOBALFOUNDRIES (GF) and TSMC today announced they are dismissing all litigation between them as well as those that involve any of their customers. The companies have agreed to a broad life-of-patents cross-license to each other's worldwide existing semiconductor patents as well as those patents that will be filed during the next ten years as both companies continue to invest significantly in semiconductor research and development. This resolution guarantees GF and TSMC freedom to operate and ensures that their respective customers will continue to have access to each foundry's complete array of technologies and services.

"We are pleased to have quickly reached this settlement that acknowledges the strength of our respective intellectual property. Today's announcement enables both of our companies to focus on innovation and to better serve our clients around the world," said Thomas Caulfield, CEO of GF. "This agreement between GF and TSMC secures GF's ability to grow and is a win for the entire semiconductor industry which is at the core of today's global economy."

"The semiconductor industry has always been highly competitive, driving the players to pursue innovation that enriched the lives of millions of people around the world. TSMC has invested tens of billions of dollars towards innovation to reach our leading position today," said Sylvia Fang, General Counsel for TSMC. "The resolution is a positive development that keeps our focus on advancing the needs of our customers for technologies that will continue to bring innovation to life, enabling the entire semiconductor industry to thrive and prosper."
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29 Comments on GLOBALFOUNDRIES and TSMC Announce Resolution of Global Disputes Through Patent Cross-Licensing

#1
MrPotatoHead
Why waste billions of dollars going to the lawyers when they are both probably right and in the wrong, let's face it.... they're both in the business of making money and both do it pretty darn good, they are probably both guilty of using each others IP's just as much as the next one and they know it so would rather not have to pay the lawyers ridiculous costs for a no win court battle, move on and gewt 5nm EUV underway
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#2
R-T-B
This feels like two bullies who went to punch each other, only to end up commenting on each others awesome biceps, and forget they were fighting.
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#3
candle_86
R-T-B
This feels like two bullies who went to punch each other, only to end up commenting on each others awesome biceps, and forget they were fighting.
More likely the money saved is more they can invest in beating Intel and Samsung in Fab tech
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#4
R-T-B
candle_86
More likely the money saved is more they can invest in beating Intel and Samsung in Fab tech
The analogy still works.
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#5
voltage
GLOBAL FOUNDRIES just got very lucky
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#6
windwhirl
windwhirl
I'll bet that in some time they will agree to settle out of courts and completely ignore, so to speak, each other's infringements :laugh:
Called it :laugh:
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#7
DeathtoGnomes
I hope this solution equates to lower consumer pricing, this also makes me think profits/stocks will benefit the most.
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#8
notb
DeathtoGnomes
I hope this solution equates to lower consumer pricing, this also makes me think profits/stocks will benefit the most.
Your sentence is self-contradictory. Lower consumer pricing stems from competition and results in lower profits.
This already suggests one part is false. And it's the first one.

A company-company agreement usually doesn't (and fundamentally shouldn't) result in lower prices. It would make no sense for the parties involved.

Objectively speaking, this looks like preparations to sell GF (currently owned by Mubadala). An open IP dispute would make it difficult to find an investor.
Best guess would be: there's already someone interested but he demanded this issue to be fixed.
MrPotatoHead
Why waste billions of dollars going to the lawyers when they are both probably right and in the wrong, let's face it.... they're both in the business of making money and both do it pretty darn good, they are probably both guilty of using each others IP's just as much as the next one and they know it so would rather not have to pay the lawyers ridiculous costs for a no win court battle, move on and gewt 5nm EUV underway
Because that's how the world works. Google: "reality".
Specialized high-tech business is built around IP. A company must have a clean sheet when it comes to what it's allowed to do.

Even if a company makes excellent chips with huge profit, it isn't worth much as long as there is no guarantee it will be able to continue to do so.
And if they don't secure IP, there's always a chance someone will sue them, win the case and the company will be shut down.
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#9
Tsukiyomi91
About time they stop bickering & actually came up with a resolution to not waste their time & money on pointless IP/Patent wars.
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#10
notb
Tsukiyomi91
About time they stop bickering & actually came up with a resolution to not waste their time & money on pointless IP/Patent wars.
Why do you think patents are worthless? Aren't they exactly what having an advantage in semiconductor business is all about? :)
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#11
dj-electric
.... What the hell?!

What do you mean? They just ended that like friends shaking hands, helping each other progress technology?!
I demand blood! I demand drama! What is this?! Disgusting!
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#12
ZoneDymo
dj-electric
.... What the hell?!

What do you mean? They just ended that like friends shaking hands, helping each other progress technology?!
I demand blood! I demand drama! What is this?! Disgusting!
^this, should have put Abraham H. Parnassus on the case, he would have CRUSHED THE ENEMY, GROUND THEIR BONES INTO THE DIRT, MADE THEM REGRET THEY WERE EVER BORN!!!
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#13
PanicLake
R-T-B
This feels like two bullies who went to punch each other, only to end up commenting on each others awesome biceps, and forget they were fighting.
Or realizing that get punched in the face will hurt more than making pace with it.
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#14
PerfectWave
GF just needed TMC patents that was a smart move to lawsuite them and get crosslicense
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#15
ratirt
notb
Why do you think patents are worthless? Aren't they exactly what having an advantage in semiconductor business is all about? :)
I don't think it is the advantage but the patent requires others to pay for it, if they want to use the technology, to the rightful owner of the patent. So if you say "business" it is always about money :)
Meaning, they invent new technology to get even more money and improving lives of consumers is a side effect to that action. :P
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#16
Aquinus
Resident Wat-man
R-T-B
This feels like two bullies who went to punch each other, only to end up commenting on each others awesome biceps, and forget they were fighting.
More like they found an opportunity to make some money or the cost of litigation (on both sides,) wasn't worth the potential gain.
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#17
Manoa
who would expected xD global foundaries striked first and TSMC didn't affraid, and striked back and now they frends ?
yhe +1 for GF get lucky, they wanted to steal the progress of TSMC and now they did
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#18
kapone32
Would it not be funny if TSMC now subbed Global Foundries to contract some of their production?
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#19
R-T-B
Aquinus
More like they found an opportunity to make some money or the cost of litigation (on both sides,) wasn't worth the potential gain.
PanicLake
Or realizing that get punched in the face will hurt more than making pace with it.
That may be the real reason but the outside appearance remains the same.
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#20
Mouth of Sauron
Why so much irrational hate towards GF? And so much irrational love toward TSMC?

AMD had fabs some 20 years before TSMC. GF bought IBM fabs and patents. GF is collaborating with Samsung, which also has fabs.

Perhaps they're not the best currently, had bad misses in the past, and not a bleeding edge now, but still? Would another competitor to Intel/TSMC actually harm the market?

Holy TSMC possesses all the knowledge about production, and worthless GF - who was suing for thousands of patents, did that exclusively for evil and get away? AMD and IBM fabs had no worthy patents at all in their 60+ years history, and it's completely impossible that TSMC, youngest of them all, actually made patent infringement?
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#21
DeathtoGnomes
notb
Your sentence is self-contradictory. Lower consumer pricing stems from competition and results in lower profits.
This already suggests one part is false. And it's the first one.

A company-company agreement usually doesn't (and fundamentally shouldn't) result in lower prices. It would make no sense for the parties involved.

Objectively speaking, this looks like preparations to sell GF (currently owned by Mubadala). An open IP dispute would make it difficult to find an investor.
Best guess would be: there's already someone interested but he demanded this issue to be fixed.
The $$$ saved from lawsuits/settlements affects profits and in the end, pricing. Dont read anything more into the blanket general statement as I am not implying anything more.
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#22
Aquinus
Resident Wat-man
Mouth of Sauron
AMD and IBM fabs had no worthy patents at all in their 60+ years history, and it's completely impossible that TSMC, youngest of them all, actually made patent infringement?
You do know that when AMD went fabless, they spun off their fabs as a separate company which is now modern day GlobalFoundries, right?
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#23
Mouth of Sauron
Of course I do, the question is more if you knew that those are the same... When you're in business ~50 years, you have own patents. Maybe moreso than 20 years younger competitor. IBM sold their foundries to GF, did you know that? They are in business since like Chip-Zero.

GF may look like a bad newcomer at market, but in fact they go a long time. IBM currently lives mainly from extremely strong research teams who make discoveries or improve existing stuff and then patent and sell it. I wouldn't underestimate thousands of their patents - GF most likely just wanted those, but they came in package with foundry. Some of those are probably old, but some are bleeding-edge, which are few years to implementation.

All taken in, I'm happy that matter is resolved this way, both companies will probably profit from agreement.

And no, it wasn't "a lucky day for GF", it was for both companies and us, customers, who will probably suffer less from shortages due to low yields or slow ramping up, not to forget that competition typically benefits customers, too.
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#24
notb
DeathtoGnomes
The $$$ saved from lawsuits/settlements affects profits and in the end, pricing. Dont read anything more into the blanket general statement as I am not implying anything more.
That's makes less and less sense. :)

IP is the foundation of this business. Defending this IP in court is an essential part of the whole concept. It's not "money lost on lawyers".

You're creating a theory that's fundamentally flawed.
Yes, this settlement is very likely cheaper than going to court (that's the point of settlements).
The interesting part is: why do you think any "saved money" would be used to lower prices for consumers? Is there any gain for the companies? :D

If you don't see how naive your suggestion was, I have a better one.
Any two companies (like Intel and AMD) could make a deal as well. They could meet and say: "hey, we're losing so much money because of all this fighting for market share - why not end this today and save money?"
And do you think that saved money would result in lower retail prices? Seriously? :D
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#25
windwhirl
notb
The interesting part is: why do you think any "saved money" would be used to lower prices for consumers? Is there any gain for the companies? :D
Funnily enough, if you think about it, there is already a profit loss just from throwing around lawyers to sue each other, then again for settling the whole issue after less than a month and probably even for simply redacting the news piece for their press rooms :D :laugh:

Expect prices to rise a couple cents at the very least :roll:
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