Apple Demanded $1 Billion for Opportunity to Win iPhone Contract : Qualcomm CEO
By MYBRANDBOOK
Apple Inc as an "incentive payment" demand for $1 billion (£780m - roughly Rs. 7,000 crores) from Qualcomm Inc in order for Qualcomm to become the supplier of modem chips for Apple's iPhone, Qualcomm’s chief executive declared on Friday at a trial with U.S. antitrust regulators.
The payment from Qualcomm to Apple - part of a 2011 deal between Apple and Qualcomm - was meant to ease the technical costs of swapping out the iPhone's then-current Infineon chip with Qualcomm's, CEO Steve Mollenkopf declared at a trial with the US Federal Trade Commission.
While such a payment is common in the industry, the size of it was not, on a report Mollenkopf said.
Under the 2011 deal, Qualcomm was named Apple's sole supplier of modem chips, which help mobile phones connect to wireless data networks, in exchange for which Qualcomm agreed to give Apple a rebate - the exact nature of which has not been disclosed. Apple could choose another supplier but it would lose the rebate, effectively increasing the cost of its chips.
Antitrust regulators have argued the deal with Apple was part of a pattern of anticompetitive conduct by Qualcomm to preserve its dominance in modem chips and exclude players like Intel.
At a federal courthouse in San Jose, California, Mollenkopf testified that Apple demanded the $1 billion without any assurance of how many chips it would buy, which pushed the chip supplier to pursue an exclusivity arrangement in order to ensure it sold enough chips to recover the payment.
Qualcomm was not aiming to block rivals like Intel, he said.
"The risk was, what would the volume be? Would we get everything we wanted, given that we paid so much in incentive?" Mollenkopf reported.
Earlier in the day, Apple supply chain executive Tony Blevins testified that it was Apple's practice to pursue at least two suppliers and as many as six for each of the more than 1,000 components in the iPhone. The company stopped trying to place an Intel modem chip in the iPad Mini 2 because losing the rebates on Qualcomm's chips would have made the overall cost too high, he said.
"They made it very unattractive for us to use another chip supplier, and these rebates were very, very large." Blevins said of the rebates.
BHIM to join e-commerce, competing with PhonePe and Google Pay
The government-supported payment software BHIM is getting ready to join t...
The latest version of X helps prevent deepfakes on social medi
To combat deepfakes and shallowfakes, Elon Musk revealed a new update t...
India and Namibia collaborate on a payment system similar to U
Once operational, the platform will enable digital transactions in Namibia,...
Sebi issues show-cause notices to six Adani group firms
Sebi issued show-cause notices to six Adani Group firms, including Adani ...
DRUVA SOFTWARE PVT. LTD.
IBALL WORLDWIDE PVT. LTD.
TP-LINK INDIA PVT LTD.
TVS ELECTRONICS LTD.
Technology Icons Of India 2023: Roshni Nadar Malhotra
Roshni Nadar Malhotra is an Indian billionaire businesswoman and the c...
Technology Icons Of India 2023: Bhavish Aggarwal
Ola CEO Bhavish Aggarwal had formed Ola-India’s largest mobility pla...
Technology Icons Of India 2023: Natarajan Chandrasekaran
Natarajan Chandrasekaran is the Chairman of the Board of Tata Sons, th...
BEL leveraging next generation technologies to keep the country ahead in Defence space
Bharat Electronics Limited (BEL) is a Navratna PSU under the Ministry ...
Aadhaar: Architecting the World's Largest Biometric Identity System
The Unique Identification Authority of India (UIDAI) is a statutory au...
BSE provides highly secure, efficient and transparent market for trading
BSE (formerly known as Bombay Stock Exchange Ltd.) is Asia's first & t...
EXCLUSIVE NETWORKS SALES INDIA PVT. LTD.
Exclusive Networks is a globally trusted cybersecurity specialist hel...
SAVEX TECHNOLOGIES PVT. LTD.
Savex Technologies is the 3rd largest Information & Communication Tec...
B D SOFTWARE
BD Software is the distributor of IT security solutions in India. The ...