“We have negotiated hundreds of bilateral license agreements over the last two plus decades. And those have clearly established a clear market value for the tens of thousand, now of patents that we hold in the whole area of cell technology,” a report in Fortune quoted a Qualcomm executive as saying on Monday.
But Qualcomm refuted the allegations, saying that Apple had intentionally mischaracterised the agreements and negotiations, as well as the enormity and value of the technology they had invented, contributed and shared with all mobile device makers “through our licensing programme”.
Regulators in South Korea issued a nearly $1 billion fine against Qualcomm in a similar case.
“Apple’s lawsuit goes to the heart of Qualcomm’s licensing model, which charges phone makers a percentage of the value of every phone, not just a cut of the price of specific modem chips used in phones,” the report noted.
The threat is worrying for the investors in Qualcomm as the company’s share price has lost 12 per cent since the day before Apple filed suit.
“Our chips had capabilities that Apple chose not to use in the iPhone 7, in my belief, because they wanted to basically employ a lowest common denominator approach. Intel’s modem chip could not do, did not have the capabilities that our chips had,” a Qualcomm spokesperson said.