Published: Wed, January 16, 2019
Electronics | By Kelly Massey

Qualcomm had a 'gun to our head', Apple says

Qualcomm had a 'gun to our head', Apple says

The Federal Trade Commission brought an antitrust suit against chip-maker Qualcomm in 2017, and it's just now playing out in court.

Mr Williams testified that Qualcomm continued to provide chips for Apple's older iPhones.

Apple and Qualcomm have a turbulent relationship to say the least.

The FTC and Qualcomm's customers accuse the company of exacting too high a price for only one part of what makes smartphones so attractive to consumers - and doing so by illegally bullying its customers into paying up. Apple split orders between Intel and Qualcomm in 2016 and moved all of its orders to Intel past year for its new iPhones. According to Apple's Chief Operating Officer, Jeff Williams, it's actually Qualcomm that has taken a remarkably hard stance against Apple and actually refused to sell chips to the company for the 2018 iPhone lineup.

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Apple supply chain executive Tony Blevins testified last week that Apple has considered sourcing 5G modems from Samsung and even MediaTek.

"They made it very unattractive for us to use another chip supplier", Blevins said of the rebates. Apple stopped adding Intel's modems into their iPad Mini 2 because they didn't want to lose Qualcomm's incentive. It will be a long wait before we find out which supplier Apple would go for, as the technology giant would reportedly stick with 4G modems this year and its 5G-ready iPhones are expected to launch on 2020. "The strategy was to dual-source in 2018 as well", Williams said Monday. As a result of Qualcomm's CEO, Steve Mollenkopf, turning down Apple, the company had to turn to Intel and request that Intel handle all of the LTE chips for the iPhones launched a year ago.

If the government prevails in the trial that began on January 4, Qualcomm could be forced to change its practices for licensing a trove of patents to device makers like Apple. This saw Qualcomm looking to get upwards of $10 per phone, which would have cost Apple somewhere around a billion dollars in annual licensing fees.

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