Published 11:12 IST, April 17th 2019
MASSIVE: Apple vs Qualcomm billion-dollar legal war over patented iPhone tech finally comes to an end
Apple and mobile chip maker Qualcomm have settled a bitter financial dispute centred on some of the technology that enables iPhones to connect to the internet.
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Apple and mobile chip maker Qualcomm have settled a bitter financial dispute centred on some of techlogy that enables iPhones to connect to internet.
surprise truce anunced Tuesday came just as former allies turned antagonists were facing off in a federal court trial that was supposed to unfold over next month in San Diego. resolution abruptly ended that trial, which also involved Apple’s key iPhone suppliers.
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deal requires Apple to pay Qualcomm an undisclosed amount. It also includes a six-year licensing agreement that likely involves recurring payments to mobile chip maker.
Investors reacted as if it were a resounding victory for Qualcomm. San Diego company’s stock soared 23% to close Tuesday at $70.45. Apple shares edged up 2 cents to $199.25.
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Neir Apple r Qualcomm would comment beyond a brief statement anuncing y h resolved ir differences. Details about how much Apple and its iPhone suppliers will be paying Qualcomm could emerge in court documents or when companies anunce ir latest financial results. Apple is due to report its quarterly results on April 30 while Qualcomm is scheduled to release its numbers on May 1.
Apple h been seeking at least $1 billion for money that Qualcomm was supposed to rebate as part of an earlier licensing agreement. Apple h begun to have misgivings about that deal as it ded more features to its increasingly popular line-up of iPhones.
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Qualcomm was seeking $7 billion for unpaid royalties it contended it was owed for its patented techlogy in iPhone. Apple’s iPhone suppliers, including Foxconn and Pegatron, wanted ar $27 billion from Qualcomm.
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dispute was clearly beginning to hurt all parties involved, motivating m to settle, said techlogy industry analyst Patrick Moorhe of Moor Insights & Strategy.
“Both Apple and Qualcomm got deeper into this than y wanted to,” Moorhe said.
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Qualcomm also held ar bargaining chip: It makes modem chips needed for future smartphones to work with next generation of high-speed wireless networks kwn as “5G.” Two of Apple’s biggest rivals, Samsung and Huawei, are alrey getting rey to introduce 5G models. iPhone would have been at a disvant if it didn’t have a pipeline to Qualcomm’s chips.
Falling behind competition isn’t something Apple can afford with its iPhone sales alrey falling.
“Ultimately, Apple realized this was more about two kids fighting in sandbox and y have bigger issues ahe with 5G and iPhone softness versus battling Qualcomm in court,” Wedbush Securities analyst Daniel Ives wrote in Tuesday research te.
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Apple h alrey lost an earlier battle with Qualcomm last month when a federal court jury in San Diego decided iPhone maker owed Qualcomm $31 million for infringing on three of its patents.
Qualcomm still faces or potential fallout from its demands to be paid royalties in dition to fees it charges for its mobile chips. Federal Tre Commission has accused company of using its royalty system to stifle competition in mobile chip market in ar case in which Apple played a central role.
A trial about FTC’s lawsuit wrapped up in a San Jose, California, court in January, but judge still hasn’t issued a ruling.
11:08 IST, April 17th 2019