Apple, Qualcomm spat intensifies, manufacturers drawn in

Posted May 18, 2017

According to a recent Qualcomm announcement, the company has revealed that they have since filed lawsuits against the likes of Foxconn, Compal, Wistron, and Pegatron, who for those unfamiliar are the contract manufacturers hired by Apple to help build the iPhone. The manufacturers, meanwhile, are still paying Qualcomm royalties for the use of its technology in non-Apple products.

"Qualcomm seeks an order that would require the defendants to comply with their long-standing contractual obligations to Qualcomm, as well as declaratory relief and damages", the company said in a news release.

Now, Qualcomm is insisting that Apple was in no position to influence the manufacturers, as the license agreements were entered into before Apple sold the first iPhone.

Asked for comment, the company referred to an earnings call earlier this month in which Apple Chief Executive Officer Tim Cook said that the company is taking a "principled stand" because Qualcomm's "really great work" is only "one small part of what an iPhone is", so doesn't merit a cut of the entire price of the handset. Apple has promised to indemnify the manufacturers for any damages resulting from breaching their agreements with Qualcomm.

In the complaint filed in the United States District Court for the Southern District of California, Qualcomm did not disclose the quantum of royalty owed to it by the manufacturers.

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Several other companies and trade associations seem to be of similar mind and have also filed briefs supporting the FTC.

Apple reiterated that it had been trying to reach a licensing agreement with Qualcomm for more than five years but the company has refused to negotiate fair terms.

Qualcomm said Apple has agreed to cover the costs incurred by the contract manufacturers.

Forbes reports that Qualcomm is suing these four manufacturers for not paying royalities to Qualcomm for the patents on its smartphone tech, including IP on cellular modems - you know, 3G/4G are a big thing. Qualcomm doesn't appreciate missing out on iPhone money and the company has sued no less than four major Apple partners.

Then last month, Apple quit reimbursing Foxconn and the others altogether for Qualcomm patent royalties - claiming it couldn't pay until the dispute was resolved. Its technology is inside almost every smartphone.