Apple would have paid up to $ 6 billion to Qualcomm to settle deal, says analyst

Apple admits that Qualcomm was its only option for 4G chips; witness questions power abuse theory

THE legal battle between Apple and Qualcomm It is spreading to levels we never imagined, and in recent weeks, with the two companies present at hearings and sharing information and exchanging accusations, the news about the case comes up every day. Recently, two of them were revealed.


First, Apple admitted at a hearing before Federal Trade Commission (FTC) It is information that, incredible as it may seem, may favor the rival. The Cupertino giant stated that at the time of the transition to 4G connectivity (which, at Ma, debuted on the iPhone 5), Qualcomm was the only option to provide modems compatible with the new technology.

Who made the statement, brought by the Bloomberg, was Apple's director of cellular systems architecture, Matthias Sauer. According to the engineer, the company would have considered using Ericsson, Broadcom or Intel parts in the transition, but neither company was able to deliver the specifications requested by Ma just four years later with the iPhone 7, another company (Intel). managed to deliver 4G modems within Apple's requirements.

The news strengthens Qualcomm's narrative that its actions do not constitute extortion or abuse of power, and that its partners (such as Apple) simply continued to buy their products because its technology was above its competitors. And in that regard, the second point of this article may further solidify this theory.

Power abuse

As reported to CNET, a key witness of the case has given a statement that may also favor Qualcomm in the decisions that will come in the coming months. The competition policy expert Tasneem Chipty FTC said the chip giant simply would not have had enough power over Apple to constitute an abuse of power relationship with Apple.

To those who don't quite remember the beginning of the story, here's a (very) brief summary: Apple has twice accused Qualcomm for its cellular connectivity technologies once for the pieces themselves included in the iPhones and a second time for charging a fee. licensing of its patents. In addition, Ma says that the rival's requirement to charge a percentage of the total cost of each iPhone instead of a flat fee for its chips is irregular; All of this together would, according to Apple, constitute an abuse of power case in which Qualcomm would be using its privileged position in the market to extort money from its partner (and other companies).

According to Chipty, however, this is not the case: "Qualcomm does not have sufficient market power to coerce manufacturers into costly contracts that would suck them billions of dollars," the expert said. She cited cases in which Qualcomm was forced to adjust its operations because of competition, such as when it had to cut its chip prices due to a strong MediaTek push in the market, or when Apple signed a deal with Intel. to supply 4G chips.

In short, Chipty's theory that Apple was never forced to accept the terms of Qualcomm Tim Cook and his class could, at any moment, turn their backs on the company and look for a more financially beneficial alternative, but kept the contracts with Apple. rival because they wanted it (or because they needed it).

We do know, however, that there are more layers in this story than the surface suggests: Last week, for example, we commented here on the alleged origin of the quarrels between Apple and Qualcomm, in which the chipmaker would have demanded a supply contract. at least 50% of iPhone modems for a certain amount of years.

That is: not everything that looks like and a lot of water will still flow under that bridge. Let's wait and see.

via 9to5Mac, AppleInsider