Qualcomm and Apple Partnership Crumbled Over Fears Apple Would Leak Qualcomm Software to Competitors

Apple and Qualcomm are embroiled in a bitter legal battle over
licensing and royalty fees that’s lasted for two years now and
has led to the breakdown of the relationship between the two
companies, but there may have been other factors in the breakup.

Leaked emails between Apple COO Jeff Williams and Qualcomm CEO
Steve Mollenkopf seen by
Bloomberg
suggest the two companies may have cut ties
over software access.


Williams wanted to continue to work with Qualcomm despite the
legal battle, but Qualcomm accused Apple of leaking Qualcomm
computer code needed to customize mobile chips. Williams
offered to “firewall” the Apple engineers using the Qualcomm
software and said nothing of value could be obtained from the
code anyway.

“In my wildest imagination of some evil intention of Apple, I
have trouble coming up with a real scenario where anything of
significant value could be leaked based on this code,” Williams
wrote in September 2017.

Mollenkopf told Williams that he was concerned about
protecting Qualcomm’s proprietary information, and while he
offered to provide software access to Apple, he asked Apple to
commit to using Qualcomm chips in at least 50 percent of iPhones
over the next two years.

Qualcomm in September 2018 accused Apple of
stealing confidential information
and trade secrets and
passing it on to rival chipmaker Intel. From Qualcomm’s lawsuit
against Apple:

Although discovery is ongoing, it is clear that Apple’s conduct
went far beyond simply breaching the contract originally sued
on. Indeed, it is now apparent Apple engaged in a years-long
campaign of false promises, stealth and subterfuge designed to
steal Qualcomm’s confidential information and trade secrets for
the purpose of improving the performance of lower-quality modem
chipsets, with the ultimate goal of eliminating Qualcomm’s
Apple-based business.

As Bloomberg points out, it appears the
software dispute was a key reason the two companies cut ties, as
both were willing to continue to work together despite the legal
battle. The fight has heated up since then, though, with Qualcomm
winning import bans on iPhone 7 and iPhone 8 models in China and
Germany.

Qualcomm is in court this week facing an antitrust lawsuit
levied against it by the FTC, with the FTC accusing the company
of using anticompetitive tactics and exorbitant licensing fees
to remain the dominant baseband chip supplier.

Executives from many companies have testified against Qualcomm,
including Jeff Williams. Earlier this week, Williams said that
Qualcomm had
refused to sell
Apple chips for the 2018 iPhone models.

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