/ Technology

Could you be due compensation on your Samsung or Apple phone?

An Apple iPhone and Samsung smartphone

Have you bought an Apple, iPhone or Samsung phone since 1 October 2015? More than £480 million could be reimbursed to customers – here’s why.

A breach in competition law could mean that millions of smartphone owners in the UK could be due compensation.

We’ve taken one of the first-of-its-kind types of legal action on behalf of consumers against US chip-maker Qualcomm.

Why have we done this? To recoup the cost of Qualcomm’s anti-competitive practices which resulted in brands such as Apple and Samsung being overcharged for Qualcomm’s technology, which in turn inflated the cost of smartphones for consumers.

Who footed the bill? We all did. UK consumers.

What happened, and what’s next?

Qualcomm’s technology is used in a range of products, and we think Qualcomm overcharged manufacturers of smartphones for licences for that technology in the form of inflated royalties.

Read more about what Qualcomm is alleged to have done

The options for consumers to hold companies to account on an individual basis aren’t effective – that’s why we’re using the opt-out collective redress mechanism, introduced by the Consumer Rights Act 2015. This means you won’t have to do anything to get the money you’re owed until we have won the claim, when you can come forward and apply for your share of the payments.

We’re sending a clear warning through this action that manipulative practices by Qualcomm and others will not be tolerated.

We are alleging that Qualcomm has abused its power and we want to hold them to account on behalf of millions of consumers. Will you join us and support our action?

Register your interest and find out if you could be due payment for your smartphone here

Comments

It is very encouraging that Which? is taking action that could benefit millions of consumers. It could help more young people take an interest in consumer rights and hopefully gain members for Which?

I suggest that the next collective action should be against printer manufacturers that have used firmware updates to block the use of third party cartridges, forcing owners to scrap their printers or use overpriced ink cartridges from the manufacturers. Recently there have been cases of the same anticompetitive action being taken to block the use of third party toner cartridges in laser printers.

I must admit, when I first read about Which?’s legal action on the mobile phone chips, I wondered why it had gone for this problem – that I cannot recall having been mentioned before in the magazine or Conversation – when there were much longer-standing issues that deserve similar attention. Perhaps now they have a taste of blood they will go for the printer manufacturers, and the smart TV makers whose programme software is not updated, and the mobile phone people who let the security systems expire after a couple of years.

That aside, I was pleased to see the success of Which? in this action and shared Wavechange’s thought that it would demonstrate to a new generation that consumer power could achieve results and that they should take a deeper interest in Which? – I feel many believe it is just another free public service that they can take advantage of with little effort whenever they get short-changed or sold-short in the internet marketplace.

This seems a very strange legal action for Which? to take up. Who is paying for all the legal costs, especially if Which? loses.

And if this is a winnable case, why haven’t Apple and Samsung taken this up as they are the ones who can afford it and who are the most affected?

Do you really think the cost of these chips has any real bearing on the cost of smartphones or is it more likely what these tech giants can get away with charging us?

I hate this compensation culture that usually achieves very little in the long run. There are always consequences that others pay for, in this case could it be Which? subscribers/members or even Which? staff?

I would much rather resources were put into lobbying smartphone companies like Samsung to support their very expensive products instead of forced obsolescence within 2-3 years.

With around 55 million smartphone users in the UK, any compensation after costs is likely to be miniscule and only a tiny fraction of the cost of being forced to buy a new phone.

We live in an age when we should be living sustainably and saving the earth’s resources, not creating mountains of e-waste and replacing our tech at the rate we are now. Which? should be doing all it can to help purchasers buy sensibly for the future instead of reducing the quality of product reviews by removing launch dates that goes against sustainability.

I wonder why the market dominance of people like Apple, Microsoft, who heavily overcharge for their products, is not similarly challenged. VW and Mastercard claims are still hanging around. Updates would be useful. If the Qualcomm claim is successful it seems those consumers who bother to claim might get around £13.

Of course Samsung overcharge for products too and do not support their phones for as long as Apple.

By claiming, the public can help tackle anticompetitive practice. It’s not just about the money.

John – I believe there has been legal action in other countries, so it might not be difficult or expensive for Which? to take action. I am very keen to see collective action being taken in the UK because elsewhere it has been successful in fighting consumer detriment caused by large companies.

It is about the money in this topic. And personal claims, such as VW and Mastercard, are about the money. I am more in favour of extracting substantial fines when, as in VW’s case, it caused real harm through excessive emissions. And doing it quickly.

Hopefully other cases of collective action will follow. I don’t know if collective action would be the right approach but I hope that Which? will take action against Currys, which seems to be letting down more customers than ever before.

When Which? is taking action on our behalf, surely it deserves some support. In my opinion there is too much negativity.

I have not into the background to Qualcomms misdemeanours and it is not clear from this intro, or the press release, exactly what the grounds for claim are. I would like it explained.

Anyone who invents something sufficiently novel is entitled to seek a patent that gives protection from copying. They can then sell the product to whom they choose, and I presume on mutually acceptable terms and, if they choose, license its production to another producer. What is the real issue here?

The action in other countries seems to have had mixed results.

I am in favour of collective action in appropriate cases – when it would not be worth an individual doing it alone. I hope it does not result in speculative litigation where the main beneficiary may be the lawyers.

@malcolm_r I am a little lost as to the basis of this case and where the sum of £5-£30 per consumer comes from, unless it is in punitive damages, since the royalites demanded by Qualcomm I’ve read about are significantly less.

However, I was going to address your assumption that the owner of a patent can use it in support of anti-competitive behaviours. That is not the case. Particularly in US business law, there is a centuries old essential facilities doctrine, that a business can be guilty of anti-trust law violations if:

– the business has control of an essential facility (through ownership, patent protection, etc.),
– a competitor is unable to practically or reasonably duplicate the essential facility,
– the business denies use of the facility to a competitor,
– it would be feasibile to provide the facility to competitors.

Em, I agree when it comes to something that is essential. However, otherwise I do not think, in the UK and Europe anyway, a non-essential patented invention must be made available to competitors. Otherwise there is little point in protecting it with a patent. https://www.gov.uk/patent-your-invention

A document linked in the introduction outlines the basis of the concern:

> It (Qualcomm) refuses to license its patents to other competing chipset manufacturers

> It refuses to supply chipsets to smartphone manufacturers, such as Apple and Samsung, unless those companies obtain a separate licence and pay inflated royalties to Qualcomm.

The CMA periodically intervenes when UK and overseas drug companies are considered to be charging excessive prices.

Here is the crux of the matter [my comments] from the US Court of Appeals Ninth Circuit ruling:

Qualcomm’s patents include cellular [telephony] standard essential patents (“SEPs”), … . Cellular SEPs are patents on technologies that international standard-setting organizations (“SSOs”) choose to include in technical standards practiced by each new generation of cellular technology. SSOs are global collaborations of industry participants that “establish technical specifications to ensure that products from different manufacturers are compatible with each other.” [In this case, it is the International Telecommunication Union Radiocommunication Sector or ITU-R.]

Cellular SEPs are necessary to practice a particular cellular standard. Because SEP holders [Qualcomm] could prevent industry participants [Apple, Samsung …] from implementing a standard by selectively refusing to license, SSOs require patent holders to commit to license their SEPs on fair, reasonable, and nondiscriminatory (“FRAND”) terms before their patents are incorporated into standards.

In other words, Qualcomm holds patents covering certain technologies required to implement 4G telephony standards. In return for these technologies being adopted as international standards, Qualcomm must agree to license their patented technologies, such that they do not prevent or inhibit other participants in the telephony market from competing. The question is not about whether they can benefit from their patents, but whether they are treating licensees and potential licensees fairly in return for having their patents adopted globally.

Thanks Em, so the the product is “essential” and I would agree that fair terms should be agreed. I wonder how the implementation of 4g got written around a single manufacturer/patent holder without terms or alternatives being agreed?

Well I guess it’s the same as how we ended up with three TV terestrial broadcast systems in the 1960s; the inferior US NTSC (unpatented) system, the French (patented) SECAM system and the German (patented) PAL system.

Except that terestrial TV is regional, whereas we expect a global system for cell phones. If the “best” system has other technical benefits, but is patented, why not adopt that? Should we always cut off our noses to spite our faces?

I’m not too sure what long term goal Which? are addressing here. The fact that Broadcomm make an excessive royalty of 1.5 USD per phone is the least of my concerns on a £600 handset that will last maybe 2-4 years. Vodafone rip me off more than that every month for mobile data I can’t use.

Patents expire and technologies become obsolescent even faster. Remember when IBM was the most powerful company in the world and subject to frequent anti-trust suits? Where are they now and where are any of their competitors? What has happened to Amdahl, Memorex, Hitachi, StorageTec … ?

Multiple alternative standards rarely benefit the consumer in the long run – look at the cost of RHD vehicles over the equivalent LHD models. Anyone still got a VHS or BETAMAX recorder? What a waste.

Sorry – for “Broadcomm” read “Qualcomm”.

I hope that Which? is dipping its toes in the water in order to explore the possibility of taking action on behalf of many consumers. Those who register their interest have nothing to lose in this case, but the lawyers will be the winners.

Stephen B says:
25 February 2021

I am curious how this applies to Samsung devices sold in Europe? They use the Exynos chipset instead of Qualcomm, which they use in the US.

It is not clear what this relates to. I assume it is tied to the Qualcomm patents concerning Snapdragon LTE modems, not the processor.

Patrick Taylor says:
25 February 2021

You can take insurance for this sort of case, find a deep-pocketed firm who like taking a chunk of the award, or possibly a no win no fee arrangement. However it would be nice to know how this is being done.

No mention of the JJB Sports case of 2007 where the charity folded at the final hurdle to negotiate a settlement. In that case the charity was paying the solicitors as far as I know.

FAQ: Which? is working with a litigation funder, Augusta Ventures, to bring the claim.

Here’s a link to an article, complete with a photo of Anabel Hoult: https://www.litigationfutures.com/news/which-launches-480m-collective-action-over-mobile-phone-chips

If they are using Augusta Ventures then they are a risk management organisation. They will fund litigation if they reckon there is a 60% chance of success. They pay the legal services needed and, if successful, expect typically around 3 times the outlay back or 20-35% of the award. But I wonder what terms Which? might have agreed.

I still don’t know what Qualcomm have done that is illegal. Hopefully someone might explain.

I wonder if someday the privileged position of the closed shop legal profession might be investigated, and the huge fees they are allowed to charge?

Em explains above what Qualcomm have done.
This might be of interest. It does not seem clearcut.
https://www.jdsupra.com/legalnews/no-license-no-chips-qualcomm-s-42322/

It is of greater concern that Which? never took any action over the Equitable Life scandal. Equitable was a Which? recommended “Best Buy” provider for pensions and investment products in case, anybody here has forgotten.

In that case, the policyholder detriment was of the order of £1000s, not £10 to £30. It is still affecting current and ex-policyholders after 20 years, but not a peep from Which? about that.

I fully support Which’s action, and I intend to participate, even though the typical payout is expected to be only £17.

However, I wish that Which would tackle some more significant unfair commercial practices, such as mobile phone networks charging for a full monthly bundle when a customer doesn’t use all of the bundle. Mobile networks should be required to refund pro-rata any unused data, minutes or texts. Charging for consumption that isn’t consumed is a blatant unfair commercial practice. This is particularly true during the pandemic when most consumers are at home on wifi with no need to use mobile data.

I agree. Mobile phone tariffs provide various examples of unfair commercial practice affecting many people. In the example you give it would be fairer to roll over unused data for future use. With some PAYG tariffs, call allowances can expire after 30 days, so you lose all your money even if you don’t make a call.

Another unfair commercial practice affecting many people is offering renewal premiums for breakdown insurance at well above the premium quoted for a new customer, even when no claims have been made.

I am keen to see collective action being used as as an additional way of tackling genuine consumer detriment in the UK.

I would like to see allowances sold in a different way instead of monthly allowances that are lost if unused.

Vodafone, on its data-only SIMs, sells 12GB for £30 valid for 12 months, or 24GB for £45 valid for 24 months. These long-term bundles give volume discounts without unfair short expiry terms on unused data. I would like to see these types of bundles extended to voice SIMs for minutes, texts and data.

I believe it should be made unlawful to impose an expiry date of less than 12 months on a bundle. This would revolutionise the way that consumers pay for mobile phone service.

Agreed, again. I used to use a Three MiFi to use mobile broadband when I was on holiday or otherwise away from home. I purchased a data SIM and that would last for 12 months or until the allowance had been used, whichever came first. That suited my needs better than having to pay monthly.

At present I have a 5GB monthly data allowance for my phone and use that for tethering. Some months it’s not used at all, but if I am away I have to watch that I don’t exceed the allowance. Buying additional data from Vodafone was expensive last time I checked.

I wanted to upgrade my mobile phone from PAYG with Vodafone to a SIM-only inclusive bundle on a two year term at £20 pcm payable by DD. After reference checks, Vodafone would not accept my order. I obtained the credit reference report and could see no adverse comments; the problem presumably was that there were no good ones either: I have not had any credit or borrowings for over 30 years. I decided to leave Vodafone and sign up with BT as an add-on to my current landline and broadband contract [at a better price initially]. Unfortunately it seems that the credit in my Vodafone PAYG account has to be forfeited on switching; while not too painful this seems to be unfair – a refund with deduction of a small admin charge would be fairer.

£20 per month for a SIM-only contract is a lot more than I pay Vodafone. I agree with what you said about forfeiting the credit, though you had the opportunity to use it up before switching. I hope you managed to keep your mobile number. In the early days switching provider usually meant being assigned a new number.

I have a friend who was in his late twenties and had never been in debt and his application for a credit card was declined. Had he had a slightly iffy credit record he might have been accepted. I would have thought that if you use a credit card that would have been enough to show you are a good risk, John.

giffgaff now charges only £6 per month for unlimited calls and texts. That also includes a token monthly allowance kof 500MB data.

More expensive monthly bundles then give more data each month.

I’ve known for a while that giffgaff is not the least expensive supplier in the marketplace.

For example, ID mobile only charges £5 per month for unlimited calls and texts plus 1GB data. Their data allowance will also roll over at the end of each month.

Yes, Wavechange, I was a bit taken aback when I received the notification that my order had been declined.

The monthly price was another reason to quit Vodafone, and I was not aware before I switched that I would lose the credit; I only found out after I had left and thrown away the Vodafone SIM card. I did keep the phone number but that was not particularly important as very few people had it.

I have two credit cards and a couple of store cards, often used quite ambitiously, but perhaps Vodafone just didn’t want me as a customer because I made so little use of their network. I don’t care really – their decision has given me a useful break. I was with Vodafone for over twenty years and, as always, discovered loyalty was a one-way street.

I decided to get internet-enabled when out and about [some chance this last twelve months!] because I could foresee that being able easily to prove one’s vaccination status via a digital passport was likely to become a necessity, or at least an advantage, and that buying drinks or meals from outside tables at pubs and restaurants using an app was becoming the norm. I think it will also be necessary when entering public buildings, travelling, using hotels, going to commercial offices, and so forth. Compulsory seat reservations on long-distance trains is imminent and ordering refreshments from the buffet by phone app will be required to reduce passenger proximity and trolleys in the aisles and vestibules. I am not sure how that is going to work efficiently if a member of staff is going to have to run up and down the length of the train every time someone orders a bacon roll or a packet of crisps and a can of coke and wants to consume them before arriving at Doncaster.

Vodafone is not my favourite company but the other networks do not provide a reliable signal round here and none of the few companies that use their network has impressed me.

That’s the overall problem – people are often tied to a network because of the geographical distribution of the masts. I originally chose Vodafone because that was the best where I lived in London. Most networks are available where we live now but a few miles down the road and we are out of range of some of the major networks. BT seemed to offer the most comprehensive coverage in our part of Norfolk and at the coast.

I suppose, once again, we have exhausted the topic and wandered off down a different track. That is the nature of human conversation and why it is unrealistic for a site with the word ‘Conversation’ in its name to insist on strict adherence to the specified subject – we are in a sub-thread after all.

DerekP, giffgaff’s prices might be attractive, but it has several shortcomings:
– No eSIM support
– No wifi calling (i.e. worse coverage for voice calls than other networks)
– High charges outside the EEA

NFH, thanks for noting that. None of those drawbacks affect me, but I can see that they would affect you. A case of horses for courses perhaps?

A quick look at Money Supermarket shows that there are a lot of nice cheap options now. I would recommend that folk read the small print and find a package that suits their needs.

From that source, I see that both iD and Virgin now have some deals with data roll over.

They don’t affect me either and since Giffgaff uses the O2 network it would be no use to me because of the lack of a reliable signal.

The Vodafone Basics plan at £10 per month would suit my needs and save me £3 but is only available to new customers. 🙁

Patrick Taylor says:
27 February 2021

Whilst it is nice to discuss mobile costs perhaps the useful targets suggested should be tabulated in the Which ? area for improving ! : ) However I am very conscious of the nature of this site where everything becomes lost by burying.

One aspect of this case is I have an unwelcome suspicion that Which? is going to financially benefit by “indorsing” this action by a venture farm who are going to get, if successful, a very large chunk of money.

I can accept this if the charity is upfront about the arrangement but given the secrecy that has surrounded the Accounts for the last decade and a half I am not confident. Perhaps the Trustees should be approached on this to discuss the ethics.

Another ethical matter remains in the charity accepting money from CurrysPCW whilst it is blatantly abusing the British consumer by it’s business methods.

I think the efforts of the businessmen lead board of Which? in the last decade has entangled the consumer charity, previously totally funded by subscribers not by business, to an organisation that boldly claims it accepts no money from government. Wow.