“Apple continues to use our technology and not pay for it,” Don Rosenberg, Qualcomm’s general counsel, said in an interview. “They’ve really left us no choice but to say, ‘You’ve got to stop this.'”
The US trade regulator will soon start investigating the complaint in August, Qualcomm said, with a trial expected next year. Rosenberg said a decision — and possible iPhone ban — likely wouldn’t happen for about 18 months.
Apple, on the other hand, continued to claim that it was pursuing legal action against the top chipmaker due to its ways of doing business.
“Qualcomm’s illegal business practices are harming Apple and the entire industry,” Apple was quoted by CNET. “We believe deeply in the value of intellectual property, but we shouldn’t have to pay them for technology breakthroughs they have nothing to do with. We’ve always been willing to pay a fair rate for standard technology used in our products and since they’ve refused to negotiate reasonable terms we’re asking the courts for help.”
Intel reportedly offered no comments.
Why are Apple and Qualcomm Clashing?
The top phone and chip-maker have been relying on each other not only for profits but to keep their wheels spinning faster than their rivals.
Qualcomm has been under financial pressure as Apple had sued the company for nearly $1 billion in January alleging that the chip-maker has been charging royalties for technologies that it has nothing to do with.
The chip-maker is also under investigation after US Federal Trade Commission alleged that Qualcomm used its exclusive relationship with Apple to keep competitors from getting stronger.
However, Qualcomm believes that the probe is unfounded and is based on a flawed theory. But the company is hitting back Apple now. It has now alleged that Apple has infringed on six of Qualcomm’s patents, including technologies that improve iPhones’ battery life. It wants Apple to pay for the patents that are now being used on the smartphones.
Apple still believes that it is in the clear. “We believe deeply in the value of intellectual property but we shouldn’t have to pay them for technology breakthroughs they have nothing to do with,” Apple said. “We’ve always been willing to pay a fair rate for standard technology used in our products and since they’ve refused to negotiate reasonable terms we’re asking the courts for help.”
So, What Now?
Apple wants the court to intervene and provide a solution. “Without an agreed-upon rate to determine how much is owed, we have suspended payments until the correct amount can be determined by the court,” Apple said.
However, the company is vehemently opposed to Qualcomm’s logic for payments. CEO Tim Cook has compared the chip-maker’s business practices to “buying a sofa” from a company that charges “a different price depending upon the house that it goes into.”
“Despite being just one of over a dozen companies who contributed to basic cellular standards, Qualcomm insists on charging Apple at least five times more in payments than all the other cellular patent licensors we have agreements with combined,” Apple has said.
Meanwhile, some who side with the chip-maker’s logic has said that Apple has reduced the chipmaker’s contribution to the iPhone. “Qualcomm spent billions of dollars developing critical technologies that Apple now seems to want to be able to have access to for free or next to nothing,” Daniel Newman, principal analyst at research firm Futurum Research, was quoted as saying by CNBC.