Apple 'Well Known' for 'Mercilessly Squeezing Its Suppliers,' Says Qualcomm CEO
Despite Apple’s federal complaint in January alleging that Qualcomm gouged the iPhone maker for billions of dollars in patent royalties on technologies it didn't own (see 1701230067), Qualcomm still views Apple “as a very important customer,” CEO Steven Mollenkopf told Qualcomm’s annual shareholder meeting Tuesday. “We're going to continue to be a great supplier” to Apple, Mollenkopf said.
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Qualcomm thinks "our basket of technologies and our basket of products are even more important to them," Mollenkopf said of Apple compared with other smartphone makers. "We expect and we hope that we will be a strong strategic partner for them for many years to come as we work through this issue,” he said of the court fight.
But Mollenkopf's tone toward Apple turned much harsher in Q&A when he said anyone who bothers to learn the “underlying details” of the court case will come out concluding that Apple, not Qualcomm, is “the bad actor.” Many of Qualcomm’s “tens of thousands of patents developed over the past 25 years have been incorporated in the CDMA and LTE standards,” Mollenkopf said. Apple in the past 10 years “has used Qualcomm technology to sell over 1 billion iPhones to become the world’s richest company,” he said.
Apple’s practices of “mercilessly squeezing its suppliers and outside application developers are well known,” Mollenkopf said. “Apple accuses Qualcomm of abuse, claiming Qualcomm’s licensing terms accepted by over 300 companies are unreasonable.” Yet several analysts estimate Qualcomm’s royalty take runs only about $12 for every iPhone shipped, he said. That “calculates out” to about one cent a day in cost over the three-year “useful life” of an iPhone, he said. “This is hardly abusive when one considers the daily use” of smartphones, and how important they have become to “users worldwide,” he said. Apple representatives didn’t comment Wednesday.