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Qamar Qrsh

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Apple Is Taking Its Fight Against Qualcomm To China

Apple is upping the ante in its fight against Qualcomm’s patent fees.

Apple has just filed two complaints against the San Diego-based mobile chip giant in Chinese courts. The first alleges violation of China’s Anti-Monopoly Law and seeks 1 billion yuan (or $145.35 million) in damages. The second requests a license agreement between Qualcomm and Apple for cellular “standard essential patents.”

“These filings by Apple’s China subsidiary are just part of Apple’s efforts to find ways to pay less for Qualcomm’s technology,” Qualcomm general counsel Don Rosenberg responded in a statement. “Apple was offered terms consistent with terms accepted by more than one hundred other Chinese companies and refused to even consider them. These terms were consistent with our [National Development and Reform Commission] Rectification plan.”

Chinese regulator NDRC had already investigated Qualcomm for violating the Anti-Monopoly Law. The two had resolved the spat in early 2015, with Qualcomm paying a $975 million fine.

Apple was behind the original regulatory actions against Qualcomm in China, but didn’t get what it wanted, according to sources close to the matter.

Apple hasn’t responded to a request for comment.

This new legal action against Qualcomm comes only a week after a slew of other legal challenges hitting the chipmaker. The United States Federal Trade Commission sued Qualcomm for holding an illegal monopoly over the mobile industry. The FTC alleged Qualcomm forced Apple to use its modem chips by lowering licensing fees and pushing competition out.

A few days after the FTC’s complaint, Apple followed with a lawsuit against Qualcomm in the US courts. Apple is seeking $1 billion in damages from Qualcomm and claimed Qualcomm “has unfairly insisted on charging royalties for technologies they have nothing to do with.”

Qualcomm is the leader in modem chips that enable phones to connect to cellular networks, but it also has a huge licensing business. Nearly every modern phone in the world has to pay Qualcomm licensing fees. Licensing is a nice business for Qualcomm: While selling the chips makes up the majority of Qualcomm’s revenue ($23.5 billion in 2016), licensing is the dominant source of its profits.

Qualcomm’s licensing model has landed it in hot water with plenty of regulators around the world. Last month, South Korea fined Qualcomm $890 million for what it described as monopolistic tactics. Regulators at the European Union and in Taiwan are also investigating the company.

Qualcomm reports its first quarter earnings on Wednesday after the markets close. Wall Street analyst firm Bernstein Research warned any results and guidance the company shares with investors will be “virtually irrelevant.”

The post Apple Is Taking Its Fight Against Qualcomm To China appeared first on Technology News and Reviews | A2Z Support.

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Qamar is a leading authority on global business trends including ‘big data’, self-employment and the social media revolution. He’s the author of the award-winning book, Marketing Shortcuts for the Self-Employed (2011, Wiley) and a regular speaker for Technology Event. Qamar has spoken about global mega trends, big data and the social media revolution at conferences and business events around the world.