- Qualcomm’s claims against Apple for patent violation are being investigated by the U.S. International Trade Commission, Tech Crunch reported last week. Qualcomm believes Apple is breaching patent law related to mobile technologies in a number of iPhone styles.
- The two are engaged in expensive lawsuits, with Apple suing Qualcomm for $1 billion and Qualcomm counter-suing over technology used to extend iPhone battery life.
- Though the USITC's investigation has thus far yielded no opinions, Qualcomm expressed its pleasure in the news, especially since it has seen a 40% decline in year-over-year profit, with an 11.1% depression in revenue.
At present, Qualcomm is enduring a slog through the desert of non-payment, thanks to Apple's deep pockets. Having enlisted the support of other users of Qualcomm technology within its supply chain, Apple has guaranteed to cover payments owed once the case is resolved, effectively creating a rift between Qualcomm and some of its customers, such as Foxconn parent Hon Hai Precision Industry, Wistron, Compal Electronics and Pegatron. The move may be seen as an attempt to "break" the company, since a significant portion of its earnings are made up of royalties.
Now that the USITC is involved, it may take issue with collusion or may question the size of the royalties in line with the Sherman Act, as Apple and its supporters hope.
Qualcomm's technology is used by countless other customers, from Aphabet, Inc. (Google) to General Electric to Walt Disney. Ubiquitous throughout the industry, its chips are used to allow connection between cellular data networks, a vital part of smart phone compatibility. Thanks to its countless other customers, Qualcomm will likely survive the attack from Apple even if its royalties are reduced, but the ultimate outcome of Apple's practices could earn the giant reprisals.