Further escalating the legal battle with chip maker Qualcomm, Apple has claimed it wanted to use Qualcomm modems in its 2018 iPhones but the Chinese chip manufacturer declined to sell after it was sued by Apple over its licensing fees.
Apple has claimed that Qualcomm owns larger number of patents essential to modern wireless communications and is abusing its position and charging high fees. The US Federal Trade Commission (FTC) has accused Qualcomm of operating a monopoly in wireless chips, forcing companies such as Apple to work with it exclusively and charging excessive licensing fees for its technology.
“According to Apple Chief Operating Officer Jeff Williams's testimony in court during the FTC trial against Qualcomm, the latter refused to sell its 4G LTE modems to Apple because of the companies' licensing dispute,” CNET reported earlier this week.
Qualcomm still provides chips to Apple for iPhone 7 and iPhone 7 Plus.
"The strategy was to dual-source in 2018 as well. We were working toward doing that with Qualcomm but in the end, they would not support us or sell us chips," Williams emphasised.
In December 2018, Apple released a small update to iOS 12.1.2 that contains software changes exclusive to China to avoid sales ban. The update changes the animation when an app is forced to close, avoiding a Qualcomm patent around app management. Now, rather than moving up and off the screen, apps now appear to shrink into themselves when swiped closed.
The company has also cut its current production plan for new iPhones by about 10 per cent for the January-March quarter.
According to a report in Nikkei Asian Review, Apple has asked its suppliers to produce fewer new iPhones than planned for the quarter late last month. It's the second time in the past two months that Apple has cut its planned production for the flagship device. In an open letter to investors, Apple CEO Tim Cook said that for the quarter ending December 29, the company now expects revenue of approximately $84 billion, down from the $89 to $93 billion it had previously projected.