While the immediate financial losses will obviously belong to Qualcomm, but in the long run Apple may be as the same, according to business technology news. Qualcomm’s lawsuit against Apple is threatening a relationship that has helped both big tech companies earn billions of dollars by climbing to the top in the smartphone revolution. Let’s see the analysis from best tech news sites.
Qualcomm filed a lawsuit against Apple’s lawsuit last Monday, which raises the possibility that the company will lose a large portion of its revenue by losing one of its largest customers. As for Apple, the lawsuit raises doubts about the ability of the iPhone to maintain its reputation for a leading product without the wireless technology of the giant chip maker.
Qualcomm shares decreases 2.1%. That is the highest level in more than two months, down to $55.35 on the New York Stock Exchange. So, within just 3 months since Apple filed a complaint on January 20, Qualcomm’s market value has lost nearly $14 billion. While Apple is still optimistic about the new iPhone coming out in the second half of the year, its stock alsp slipped 1.1%, down to $ 141.63 on Tuesday.
In 2016, the number of Apple shipments fell for the first time. That forces the company to focus more on profits, not just on growth. So Apple has increased pressure on suppliers to save money. And their battle with Qualcomm is the culmination of these tense negotiations.
Both companies criticized each other for lying, bullies and other illegal acts. The centerpiece of the controversy is about licensing fees. It has turned Qualcomm into the world’s most profitable chip maker and it may have reduced a few percentage points in iPhone profits.
According to Apple, Qualcomm is abusing the power of its major suppliers of smartphone chips and related patents to prevent competition. And they has earned billions in license fees that they do not deserve.
However, quitting Qualcomm seems to be more difficult. When the iPhone 7 came out last year, there were two versions with two different modems, one using Qualcomm’s modem, another using an Intel modem. However, according to Qualcomm’s submission, Apple has been trying to force the company not to disclose this information because of concerns that a comparison between the two versions of the iPhone may cause problems. But in November last year, the Bloomberg site reported that the iPhone version 7 using Intel’s modems was inferior to Qualcomm’s version of the modem.
Qualcomm owns patents that make up the fundamentals of modern mobile technology. They have charged the handset manufacturers with part of the price of the device, regardless of whether they use chips or not. However, Qualcomm accuses Apple of abusing market position. This has led to a series of antitrust lawsuits, stretching from South Korea to the United States, threatening to create restrictions on this licensing business model.
They still think that there is another way, if Apple is aware of the role of Qualcomm technology and pay for them. Qualcomm’s chief legal adviser, Don Rosenberg, said in an interview: A second way to handle such things is through negotiations and business solutions. They obviously do not want a dispute.