Eternally engaged in a mobile wrangle

This July, a court in Delaware will rule on one of the telecoms industry's more intractable disputes. In front of the judge will be two of the true heavyweights of the mobile phone business, chip designer Qualcomm and handset maker Nokia.

At stake is whether Nokia has the right to use Qualcomm's patented technology in its phones, especially those running on high-speed 3G networks. Nokia claims it has paid everything it should for the use of the technology. Qualcomm, for its part, rejected a $20m (£10.2m) settlement a year ago in a dispute that has been running, in one form or another, since the turn of the millennium.

For Paul Jacobs, Qualcomm's chief executive for the past three years, the case has been posing the question of whether his true calling is as an engineer, a company executive or a lawyer.

Almost immediately on taking the helm, Mr Jacobs found himself embroiled in patent disputes both with Nokia and rival telecoms chip designer Broadcom. "I did not expect to be doing what I am having to do," he says, referring to the time he has spent on litigation.

"We have done a good job focusing our employees on the business, and the business has done well. But it is distracting to be in the middle of this. It does not make our customers happy and the [mobile] operators are not pleased. And for the companies that have attacked us – it doesn't help them at all. That should be the basis for reconciliation but it has not been so far."

So could he not just pick up the phone to his counterpart at Nokia, Olli-Pekka Kallasvuo, and agree a truce? "We do talk to each other – we recognise the opportunity. But we also recognise that right now the positions our two companies have are fairly far apart," says Mr Jacobs, struggling to keep the frustration out of his voice. "He thinks we should be more flexible, we think they should be more flexible. Although we are talking, we're making a little, not a lot, of progress."

Mr Jacobs, who trained as an engineer, would certainly rather be developing new technology than going to court. In the past few years, Qualcomm's business has expanded from one focused on the CDMA mobile phone standard, a rival to Europe's GSM system, to one whose technology is used in most of the world.

This is also one of the reasons behind the court cases. W-CDMA (wideband code-division multiple access) is a key part of the standard that allows GSM phones to run on 3G networks.

The UMTS technology used by companies like Orange, Vodafone and T-Mobile runs W-CDMA for high-speed data and more efficient voice services, dropping back to GSM in places where there is no 3G signal.

Qualcommis at the forefront of mobile technology. Most of the 3G data cards for laptops run its chipsets, and Qualcomm has also developed a 3G chip, Gobi, that laptop makers such as Dell and HP are building into their machines.

All this has been profitable: Qualcomm's turnover in the first quarter of this year reached $2.44bn, 21 per cent more than in the first quarter of 2007. Net profits rose 18 per cent to $767m. It's just a shame Mr Jacobs has other things on his mind.