During a California hearing where the United States Federal Trade Commission (FTC) is suing Qualcomm for monopoly creation, Jeff Williams, Apple’s chief operating officer, was called in to testify and made a startling revelation: even in the face of a judicial battle against the company (and eventually took some iPhone models out of China’s stores) Apple still wanted to continue using the brand’s modem chips.
According to testimony given by Williams, before closing with Intel, Apple sought Qualcomm to provide the modem chips that would be used in the XS, XS Max and XR iPhone, but Qualcomm refused to close the deal, which eventually forced the company to seek out Intel.
Although the decision may seem illogical – after all, it is the refusal of a contract that would be worth a few million dollars more for the coffers of the company – it is worth remembering that both companies wage a judicial fight because Qualcomm claims that Apple owes it million dollars in licensing fees that were never paid, so it would be kind of weird for the company to charge Apple with breach of contract and then close a new deal with it.
But Qualcomm’s problem with the FTC is that the federal agency is accusing Qualcomm of predatory practices to prevent other chip vendors from entering into contracts with Apple. And while Qualcomm CEO Steve Mollenkopf assumes he has an exclusive deal with Apple, he guarantees that everything was done within the law. The exclusivity agreement between the companies ran between 2011 and 2016, where Qualcomm paid $ 1 billion in cash to Apple and guaranteed the company a discount on the price of modem chips so that the company was the only supplier of these components for iPhones.
It is expected that the judge will reach a decision on the case by the end of this week, but there is a possibility that any of the parties that lose will appeal to a higher court and prolong the case indefinitely.