Qualcomm Says Its Innovations Are At the Heart of Every iPhone as Battle With Apple Intensifies

Discussion in 'MacRumors.com News Discussion' started by MacRumors, Jun 21, 2017.

  1. Rocketman macrumors 603


    Apple actually likes and prefers Qualcomm product. They just don't want to bend over to buy it. They are doing Qualcomm a favour by buying, not the opposite. Once Qualcomm agreed to FRAND terms to improve adoption of their chips over Broadcomm and Intel, they gained a competitive advantage at a "fair price". IT's time they receive ONLY that fair price and not one cent more. This behavior on their part will incentivise Apple to adopt chips from Broadcomm, Intel and the Russian equivalent.
  2. StevieD100 macrumors 6502a


    Jan 18, 2014
    Living Dangerously in Retirement
    Yet the rest of the world does not use it.
    You make it seem that no other phone system is worth a bent dime. The billion or so non CDMA users might like to disagree with you.
    The best parts of both CDMA and GSM are in LTE and beyond
  3. tongxinshe macrumors 6502a

    Feb 24, 2008
    Hey, you can also say the whole cellular network system is one big product, so when AT&T and Verizon sell a piece of that network system to their customers (by charging them monthly), Qualcomm is simply granted a fixed percentage of each of those payments.
  4. wowotoe macrumors member

    Jun 25, 2007
    I'm in Taiwan and I use Tmobile's GSM version of i7+. I'm happy with my near 100mb download. Even if I gain additional 30mb of speed by switching to Qualcomm chip, I don't think I'll noticed the difference.

  5. bmelson0412 Suspended

    May 30, 2014
    Seriously? Qualcomm. Pretty sure its Alien Technology that got us this far. Not your innovations. :D;)
  6. twolf2919 macrumors regular

    Aug 26, 2014
    What custom chips are you referring to? And, even if Apple did ask for custom chips, charging a higher *fixed* price is a lot different than demanding a variable price that depends on the price of the product - which is what Apple is claiming - and QCOMM is not denying. You're also not addressing the 'double-dipping' aspect of this - where Apple vendors who order QCOMM's chips also have to pay a licensing fee - for the same technology that went into the chips they just bought!

    You make no logical sense. The company makes record profits because they're selling a product that record number of people want to buy! I'm on my 3rd iPhone - and I spent the same amount of money n the first as on the last - $650 - so Apple has not begun price gouging folks as a monopolist could. In any event, what does that have to do with the cost of R&D anyway? If you bothered looking into it, you'd find that AAPL does, indeed, spend a LOT on R&D(in terms of actual dollars, there are only a handful of companies in the world who spend more). You think their profit margins are 'ridiculous', why? You are aware that Google's profit margins on their search engines and Microsoft's profit margins on all of their software products are *way higher* than Apple's profit margin? Let me explain capitalism to you: here's no such thing as 'ridiculous profits' - there's only supply and demand. If Apple's price were "ridiculous", there would be no demand and Apple would be out of business. Yet, year after year, they have record demand. I guess you think there are a few hundred million deluded people out there - hundreds of million of people who had the wool pulled over their eyes by Apple! But isn't it more likely that there are just a few folks - the ones who think Apple is charging ridiculous prices - who are deluded?

    One final thought on costs: how much do you think it costs Google to develop, enhance/maintain Android? It is obviously not ZERO (in Oracle's lawsuit of Google over Java, it was asserted that it had a value of somewhere around $20 billion). How much do Android phone makers pay Google for the use of that OS? While not ZERO, it's pretty close to it. Google pays for Android with its one cash cow: advertising dollars (and your privacy). Apple doesn't have that luxury - it develops its own OS, doesn't sell your personal information to advertisers - and, thus, charges you more for its products. And it makes a great profit while doing so - which most people who care about privacy, integration, ease-of-use, etc. don't mind paying.
  7. AdonisSMU macrumors 604

    Oct 23, 2010
    They didn't used to be off the shelf. Apple was the first to introduce them.
    --- Post Merged, Jun 21, 2017 ---
    So basically Qually wants Apple to not only pay for their product but also pay them an additional percentage of the total cost of the phone. That's a terrible deal. No wonder Apple is not happy with Qually.
  8. bwillwall macrumors 6502a


    Dec 24, 2009
    Apple invented the modern smartphone but you don't see Android manufacturers paying a percentage of every profit they make to Apple. It doesn't matter who invented the tech first... it matters that everyone can do it now and Qualcomm forces anyone to use their chips and pay royalties for any CDMA network. They just don't want to admit that their company has nowhere to go if they can't keep piggybacking on a single invention from decades ago.
  9. LordVic macrumors 603

    Sep 7, 2011
    He went on to privately consult and produce plays on broadway. He's not gone on to do nothing, unless you think doing anything but working for Apple is "nothing"

    Well, to be honest, Apple very much wants this. Hence going after Samsung for patent infringement and asking Samsung to pay a percentage based royalty fee for violation of their patents.

    They also have a cross patent license agreement with HTC that likely sees a percentage of HTC's phone costs come back to Apple.

    They also take percentage of all revenues on the App store, even after the transaction complete. For example, once you've downloaded Spotify app to your phone, Apple is no longer involved in any portion of the transaction, yet if you sign up via the App store, Apple takes a percentage.

    Don't take this as me passing judgement on Apple's business practices. It's just me pointing otu that Apple themselves to very well participate in such percetnage based royalties where they can get away with it. No Different than QC. Only difference is now Apple doesn't want to pay the previously agreed upon terms and is trying to use the courts to change the terms in their favour
  10. kegan forbes macrumors newbie

    kegan forbes

    Jun 14, 2017
    I'm just going to drop this right here since I'm seeing a trend of people completely forgetting what the initial lawsuit was about

    "The Cupertino, California, company claims in the U.S. suit that Qualcomm demanded onerous terms for the use of its patented technology and even sought to punish Apple for cooperating in a South Korean regulatory probe that dove into Qualcomm’s licensing practices — practices that are now under the microscope once again.

    Apple’s documents also mentioned that Qualcomm required Apple pay a percentage of the selling price of the iPhone in return for the use of Qualcomm patents, and demanded that Apple use Qualcomm chips exclusively between 2011 and 2016. While Apple did get so-called “quarterly rebates” under the agreement, Qualcomm began withholding those rebates when Apple agreed to work with the Korean Fair Trade Commission. According to the suit, Qualcomm even told Apple that Apple had forfeited almost $1 billion in rebates by working with regulators."
  11. macTW Suspended

    Oct 17, 2016
  12. Delgibbons macrumors 6502a


    Dec 14, 2016
    All the screens on your iPhone 8.... Samsung.

    You're welcome.
  13. daabido macrumors member

    Dec 16, 2008
    About 70 million display panels coming up apparently. I'm sure Apple would love to sever the Samsung umbilical cord, but realistically won't be able to for a while.
  14. Delgibbons macrumors 6502a


    Dec 14, 2016
    Samsung "tech" (memory, screens etc) have always had a cordial relationship with Apple. I guess it's a different section of Samsung fighting the patent battle.
  15. tongxinshe, Jun 21, 2017
    Last edited: Jun 21, 2017

    tongxinshe macrumors 6502a

    Feb 24, 2008
    And it all started with Qualcomm withholding the $1 billion rebate it agreed to give Apple.

    Qualcomm did that because it has long had the commanding power in the industry, and also believes that it can single-handedly command how to punish other players in the industry. In this case, it was punishing Apple for cooperating with Korean government in investigating Qualcomm's monopoly actions.
  16. IG88 macrumors 6502


    Nov 4, 2016
    No. Apple is owed $1B in back royalty "rebates." Qualcomm got pissed at Apple, decide to withhold $1B, that's what started this whole mess.
  17. jack5150 macrumors newbie

    May 1, 2017
    tim cook is so boss. qcom has contracts (i.e., license agreements) with aapl's suppliers (foxconn et al) to the tune of 2 billion a year and cook's like, "nah, we're not paying." in the meantime, gonna use that qcom ip in the iphone 7 refreshes and the iphone x while the dispute languishes in court. cook playing 4d chess. #respect.
  18. pika2000 macrumors 603

    Jun 22, 2007
    The idolization of Forstall is getting into a new level of ridiculous.
  19. MacBram, Jun 21, 2017
    Last edited: Jun 21, 2017

    MacBram macrumors regular

    Jan 28, 2002
    Zeeland, Nederland
    I think Apple has done a lot with the screen (albeit particularly on iPad): I believe they have worked with glass manufacturer (Corning?) on lamination specs and process, and how and where the touch sensors are placed in relation to the surface, the nature of the sensors, and how many sensors, etc. (especially for the pencil). Then there is True Tone, etc., and wide color gamut. And now there is 120mHz refresh rate on iPadPro.

    Then they get one of their supply chain manufacturers to make it to those specs, they don't just choose what that company is already making for another phone maker. So, you can't just say it is a completely off-the-shelf LCD, at X-pixel dimensions.
    --- Post Merged, Jun 21, 2017 ---

    Sounds like you are a little upset at Apple just because all the other phone makers have a flawed business model that is unsustainable.

    You could say "No X is worth Y" for any industry or service.

    What do you use your computer and devices for? I am a web developer. Guess what, websites are "commoditized" these days. Many might say, "No website is worth more than $500!". For many people that's true. Go set up your own Wordpress site, host it yourself; go use Wix or Squarespace; and be up and running in 15 minutes. Go find an offshore team to outsource to through a freelance site -- they will race to the bottom to compete with all other offers and try to sell you a website for less than your budget.

    So, what does a person ever pay for when they go "Premium" on anything, even when it doesn't seem affordable up front? Why would anyone ever pay 2K, 5K, 10K, 50K for a website when you could get a free or cheap one? All kinds of things: peace of mind, knowing there is a responsible party when help is needed, security, updates, longevity, someone intelligible to talk to, immediate service, unique features that actually deliver value, the attention to detail, care for the code and standards/best practices; and the list goes on. Notice we haven't even touched the components and materials and assembly (as for a product like the iPhone).

    So, while the statement, "No website is worth more than $500!" might ring true for many people, it's certainly not true as a general statement. Neither is your statement about phones.

    Please, go buy a $200 phone and be completely at peace with your purchase for the next three years. After all, a phone is a phone; how could what lies under the surface of a complex product or service make any difference, and why should any of that impact the price? (hello, software for one, which on an Android device is completely subsidized by Google's ad and tracking machine)

    Why do you think there are still web developers in this age of Wix? Why do you think Apple is doing so well, and actually selling lots of phones, when phones generally seem to be commoditized? I would suggest because we are trying to compete along different metrics than the "No X is worth Y" crowd is comparing or evaluating, or even seems to care about (until they do); and that's a conscious and calculated decision and strategy.
  20. techwhiz macrumors 6502a

    Feb 22, 2010
    Northern Ca.
    No respect for people/companies that decide they don't like the contract they signed and try to sue their way out.
    Apple thought the contracts were fine until they had a second source and the other terms kicked in.
    They signed the contract before Intel had a modem division so they thought "what the heck".
    Now they want to use Intel and the terms suck.
    There is no possible way to make a cellphone and not end up paying some money to Qualcomm.
    You can't make WiFi without paying some money to Qualcomm.

    The model Qualcomm uses allows low cost handsets in emerging markets.
    If they did not do this there would be no cheap phones because everyone would be paying them $25 a handset or some crazy amount.

    Once again Apple is talking out of both sides of their face.
    The App Store is a prime example of Apple getting 30% initial App cost + 15% for recurring updates if they cost.
    Why does Apple not charge a flat fee per App? Low cost Apps would disappear.
    They use a similar model and they don't like it used on them.

    I like Apple products and have Apple stock. Wrong is wrong.
  21. Delgibbons macrumors 6502a


    Dec 14, 2016
    Lets br clear here. Without Qualcomm, your next iPhone will be 3g.
  22. Michael Goff Suspended

    Michael Goff

    Jul 5, 2012
    Let’s be clear: if Qualcomm were to try to deny Apple the use of their SEP, they’d lose the case so fast it wouldn’t even be funny.
  23. Delgibbons macrumors 6502a


    Dec 14, 2016
    :D just saying...Qualcomm did the R&D into the tech just as they are for 5g. It's a fact.


    Maybe Apple should invent their own proprietary communications standard using substandard Intel modems which, by Apple user's own admissions, are dreadful.

    Interestingly I remember my old Samsung Note 4 having a mini Qualcomm 4g sticker on the top of it. I tore it off as soon as I received it but I'm wondering if that was some kind of deal to get the chips cheaper or something....
  24. MacBram macrumors regular

    Jan 28, 2002
    Zeeland, Nederland
    Like all touch sensors in all smart phones are equal. I am sure Apple specifies each and every aspect of the sensor itself, like how sensitive they are, plus: how many; how and where they are placed, how close to the surface of the glass, the layers and lamination, etc., etc.

    Saying "Apple didn't invent this or that" is such a gross oversimplification. They constantly and uniquely iterate upon many aspects of most components.

    Most phone makers truly do use "off the shelf" stuff -- they have to, they are making a whole portfolio of phones, throwing everything at the wall to see what sticks just in an effort to sell as many units in total per quarter as Apple sells of just the iPhone, all while trying to make enough of a margin to stay afloat while they are forced to race to the next model that must include the latest trend or feature, just to sell a few more units, leaving the purchasers of their last model (just last month) in the lurch.

    So, X/Y/Z phone makers are "ahead" of Apple, because they are, for example, using off-the-shelf IPS (or whatever) already, while Apple is not? Yet Apple has worked on its "plain old LCD" panels for years, specifying the lamination, the sensors and arrangement, the color gamut, etc. etc. As they start using IPS, Apple will perfect that, too. And by all accounts Apple is now working to incorporate the home button into the screen.
  25. MacBram, Jun 22, 2017
    Last edited: Jun 22, 2017

    MacBram macrumors regular

    Jan 28, 2002
    Zeeland, Nederland
    The minutia make all the difference, because they, and the different context make the behavior completely incomparable. Apple was asking for Redress/Damages for Samsung continuing to sell a product that sold because it benefitted from similarities to the iPhone and alleged patent infringement that Samsung didn't acknowledge. It continued to sell and profit from the alleged infringing products while an injunction against its sale was filed and being considered.

    Apple asking for damages relative to profits and total value of products does not indicate the amounts for which Apple would have licensed use of its patents.

    If Intel totally disregarded the need to license any technology from Qualcomm, and Intel went ahead and supplied chips at half the cost of Qualcomm chips, and Apple went ahead and assembled, AND Apple refused to pay any additional royalties asked of it, and nevertheless sold millions of iPhones containing said chips, then you can bet that Qualcomm would sue Apple for damages that were relative to Apple's profits and the value of all those iPhones.

    Now, Apple has already put aside, and accounts for, the amounts that Qualcomm expects under current contractural arrangements. But Apple is withholding it pending outcome of all these investigations (and there are numerous from all quarters) into Qualcomm's licensing practices.

    The question here is that Apple believes that it has already paid too much, for FRAND patents, and that Qualcomm continues to be unreasonable -- to everyone. ...Samsung had not paid Apple anything, for non-FRAND patents.

    So many comments all the time: "Well Apple does X,Y,Z too, such hypocrites!". If comparing X,Y,Z means you can find one little phrase or element in common (i.e.., "percentage of profit") between two otherwise wildly different scenarios that are worlds apart in terms of context and 99% of the details!

    Again, the fundamentally different minutiae and details of the case you profess to recognise make all the difference about what behavior is called for or appropriate at any given time. You can't pay lip service to differing minutiae, and then say, "the resulting behavior sounds like extortion, like Apple habitually does the 'exact same thing' that it calls others out for." That's no better than making an ill-informed, inflammatory pronouncement following an extremely surface reading where you latch onto "similarities" in order to make a specious case.

    And re: "Same Percentages across all their clients" : IF Qualcomm can and should continue to license FRAND technology based on percentage of costs of a unit, then perhaps there should be a standard way to figure a cost -- such as BOM, not retail price. Apple shouldn't be penalized for adding value, iterating, and innovating in all sorts of ways that mean it can maintain an industry-leading constant ASP in the face of everyone else losing money and having to offer BOGOF deals in order to shift some units languishing on shelves and in warehouses. Everyone else's failing business models and commoditized products should not penalise Apple.

    --- Post Merged, Jun 22, 2017 ---
    Apple is not hypocritical. This is standard procedure for any retailing. Or, do you think that Walmart, Target and every mom & pop must test, review, house and sell your product for nothing, and be forced to take it and sell it at cost regardless? Ridiculous. You could buy the same product off a market stall or the back of a lorry, but if you buy it in a shop, you can bet it will be at least 30% more expensive. ALL sellers apply a markup, otherwise they wouldn't be in business.

    Anyway, it's not the same thing at all. MS sets a retail price that it wants for its product, with the understanding that the seller retains 30% of the sale (same as for boxed versions in a physical store). That product is delivered to the end user as is, in the way that MS intends.

    But, licensed technology is not a "product", not something that is delivered (hence the markup) to the end user for use as-is. It's incorporated into something else.

    Should brick companies charge more for bricks because they are being used in mansions or palaces, instead of in hovels?

    Right, let's "tax" architects right out of existence and let everyone use the same off-the-shelf plans, because "designed" homes will be completely unaffordable. No, you simply buy the amount of bricks you need at the same price per brick as everyone else; and innovate around the overall combination of materials and how they are put together, as much as you can through good design.

    Similarly, you license the technology you need to incorporate into your designed computing device, regardless of whether yours is a "mansion" and your competitor's is a "hovel".

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