Apple has sued iPhone modem supplier, Qualcomm, in a dispute over royalty payments, claiming the company has been “charging royalties for technologies they have nothing to do with.” shortly after the U.S. Federal Trade Commission filed a lawsuit against Qualcomm over unfair patent licensing practices.
In a formal statement by Apple, a company spokes person says that Qualcomm has taken “radical steps,” including “withholding nearly $1 billion in payments from Apple as retaliation for responding truthfully to law enforcement agencies investigating them.”
Speaking to CNBC, Apple said…
“For many years Qualcomm has unfairly insisted on charging royalties for technologies they have nothing to do with. The more Apple innovates with unique features such as TouchID, advanced displays, and cameras, to name just a few, the more money Qualcomm collects for no reason and the more expensive it becomes for Apple to fund these innovations. Qualcomm built its business on older, legacy, standards but reinforces its dominance through exclusionary tactics and excessive royalties. 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.
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To protect this business scheme Qualcomm has taken increasingly radical steps, most recently withholding nearly $1B in payments from Apple as retaliation for responding truthfully to law enforcement agencies investigating them. – Apple believes deeply in innovation and we have always been willing to pay fair and reasonable rates for patents we use. We are extremely disappointed in the way Qualcomm is conducting its business with us and unfortunately after years of disagreement over what constitutes a fair and reasonable royalty we have no choice left but to turn to the courts.”
Up until the iPhone 7 and iPhone 7 Plus which added Intel as a supplier in certain models, Apple solely relied upon Qualcomm modems to be used within their line-up of iPhones and iPads.