At the heart of the Apple vs Qualcomm dispute could be the bigger question of whether the latter is following a monopolistic attitude in its business practices.
The Apple versus Qualcomm legal battle has entered the next phase with the chip maker filing a counterclaim in which it accused the iPhone maker of having breached contract norms.
According to Qualcomm’s 134-page filing, Apple’s iPhone wouldn’t have had as much appeal as it now enjoys without active contribution from the chipmaker. As Don Rosenberg, executive vice president and general counsel of Qualcomm stated, one reason the iPhone franchise has been incredibly successful is because the device is based on some of Qualcomm’s fundamental cellular technologies.
In fact, it is above that can be considered the prime reason the two companies are at loggerheads. With Qualcomm charging all device makers a royalty if they make use of any of its technology, it does make a lot of sense for it to counter Apple’s lawsuit with enough ferocity; more so when a third of its revenues comes from such patent licensing deals.
Apple, however, believes Qualcomm has been unjust in charging royalties and accused the chipmaker of being unable to come up with fair licensing terms. The Cupertino giant also said it believes the royalty it pays to Qualcomm should be based on the value that the particular technology adds to each device, rather than the price the device sells for in the market.
Whether or not there are enough merits in Apple’s arguments is something best left to experts and judges to decide though what can’t be ignored is the fact that this isn’t the first time Qualcomm has been dragged to court for the way it charges royalty fees. The company had earlier opted for an out of court settlement with a few Chinese manufacturers, besides also agreeing to pay $1 billion.
South Korea’s Fair Trade Commission too has accused Qualcomm earlier for following an unfair business model that allowed the chipmaker to create a monopoly in the market. Qualcomm also faces a fine of $850 million if charges against it are proved.
Coming back to the case against Apple, Qualcomm said it is denying all the accusation made against it. The company also stated they have created the fundamental technologies that led to the creation of 2G, 3G, and 4G cellular technologies and accused Apple for not acknowledging their contribution.
Other accusations brought by Qualcomm against Apple include undue interference in the manner it conducted business with other manufacturers and deliberately throttling the performance of iPhones fitted with its chips.