By Vishal Goel, | January 27, 2017
Qualcomm CEO Stephen Mollenkopf has hit back at Apple over the latter's lawsuits against the chip making company. (YouTube)
Steve Mollenkopf, Qualcomm CEO, and Derek Aberle, head of Qualcomm's licensing business, have fired back at lawsuits filed by Apple against the company last week in the US and China. They said that the lawsuits are Apple's effort to squeeze as much money as possible from its supplier.
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In a call with analysts about its quarterly earnings report, Mollenkopf said that Apple's complaint contains a lot of assertions, but it is a commercial dispute in the end, over the price of intellectual property, CNET reported.
He said that Apple wants to pay less for the fair value that Qualcomm has established in the marketplace with its technology although the Cupertino-based tech giant has generated billions in profits from using its technology.
Aberle added that the iPhone maker company's complaints are all without merit and that Apple essentially wants to pay less for the technology it is using.
However, Qualcomm plans to keep supplying chips to Apple even as both companies battle in the courts. "I'm confident we'll get through the legal challenges underway, as we have done many times in the past," said Mollenkopf.
The legal challenges he is referring to includes a lawsuit filed last week by Apple in the US and two filed this week by the iPhone maker in China. Additionally, the US Federal Trade Commission has also accused Qualcomm of forcing Apple to use its chips exclusively in exchange for lower licensing fees.
Apple has responded to the comments of the two Qualcomm executives saying that the company deeply believes in innovation and has always been willing to pay fair and reasonable rates for patents. The company said that it is "extremely disappointed in the way Qualcomm is conducting its business."
The Lawsuits
Apple's lawsuit filed in the US alleges that the wireless chipmaker company did not give fair licensing terms for its processor technology. Apple also said that Qualcomm sought to punish it for cooperating with a South Korean investigation into Qualcomm's licensing practices by withholding a $1 billion rebate.
As a result, Apple wants the court to lower the amount it pays Qualcomm in licensing fees and order the return of the $1 billion. The company also said that Qualcomm should be paid royalties based on the value of its contribution, not for the contributions of other patent holders. Currently, Qualcomm's royalties are based on the selling price of the phones its chips are used in.
In another lawsuit filed in China, Apple said that Qualcomm "abused its clout in the chip industry," a violation of China's anti-monopoly law, and thus it is seeking 1 billion yuan ($145.32 million) in damages. A second lawsuit accuses Qualcomm of not making its cellular standard patents broadly-available and cheap. Thus, it is asking the court to determine the terms of a patent license between Qualcomm and Apple.
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