Cupertino giant, Apple’s executive Jeff Williams, in a courtroom told that they will cut off the chip supply or iPhones from Qualcomm, and this was the time when they had been compelling testimony against Qualcomm in the Federal Trade Commission’s antitrust case. The FTC argued that Qualcomm wouldn’t sell chips if the customers didn’t pay such high licensing fees. An email exchange between Williams and the Chief Executive Officer of Qualcomm, Steve Mollenkopf revealed that the relationship between the two giants might have gone sour due to other reasons only.
Bloomberg reported the emails and suggested that the deals of billions of dollars in chip supply could have been indeed collapsed due to an issue regarding software access, rather than what Williams told (about the patent fees which sparked a bitter legal battle between the two companies),
With the aim of keeping Qualcomm to supply modems for a part of Apple’s 2018 iPhones, Williams dismissed the licensing dispute rumors and said that they would be focusing on the potential benefits that can be taken when the two companies continue to work together.
Williams said that Apple would never leak the key Qualcomm computer code which is essential in customizing the modem chips, which is what the chipmaker accused the iPhone maker of doing.
The chief operating officer also offered to protect the engineers using the software. Williams, in 2017, said- “In my wildest imagination of some evil intention of Apple, I will have trouble coming up with a real scenario wherein anything of significant value might be leaked that would be based on this code. I just hope the licensing dispute wouldn’t cloud the team of good judgment which might cost them a massive business opportunity. Apple has been planning to order around $2 billion (approximately Rs. 14,000 crores) worth chips from Qualcomm for the year 2018. I wanted to keep some quantity business flowing with the aim that the issue of licensing stuff would eventually be solved.”
As a response, Mollenkopf said that his main concern has been about the protection of Qualcomm’s proprietary information and he never saw much action from Apple with regards to earlier complaints from Qualcomm on the same issue. He said- “This is different from the license dispute.”
If the emails are to be considered, Mollenkopf anyway provided the software access which was required by Apple. In return for the key, he demanded a commitment from Apple which would use Qualcomm modem chips for at least 50 percent of their iPhones over two years.
The email exchange also suggested that Qualcomm and Apple had been arguing regarding the software, instead of the licenses issue, which was the main issue in their legal battle. No one has seen the email exchange and the reports might have only got to see a part of the email based on which these conclusions are being made. The email exchange wasn’t even submitted to the FTC trials as of now.
In the court, Williams told that this week he had spoken to Mollenkopf regarding the chip supply issue over the phone but details of the conversation weren’t provided.
On Friday, the FTC confronted Qualcomm Chief Technology Officer James Thompson with the 2014 email exchange which happened between him and Mollenkopf wherein the CTO suggested- “striking back at Apple when we are strong in between all the licensing negotiations.”
Thompson considered Apple to be in a vulnerable state since they had been losing big business in North America and China, at that point in time. An Apple spokesman was contacted regarding this issue, but they didn’t respond to a request for comment. Qualcomm, as well, declined to comment.
During testimony in the FTC case this week, Williams said that Qualcomm didn’t supply Apple with modems after they had sued the semiconductor company. He said that he had contacted Mollenkopf by email as well as by phone and had tried to persuade Qualcomm to supply chips for their 2018 iPhone models.
Williams told Judge Lucy Koh, who is presiding regarding the bench trial in San Jose- “We tried to get them to sell us chips, but they would not. The case will be further continued on Friday.“
To conclude, Intel Corp has finally become the sole provider of iPhone modems, crucial chips which have helped phones convert radio signals into data and voice. Qualcomm after this sued Apple and accused Apple of using their software in improving the performance of Intel chips.