Apple Settles Lawsuits with Telecommunications Equipment Company

Category: Business


Unlocking Word Meanings

Read the following words/expressions found in today’s article.

  1. withhold / wɪθˈhoʊld / (v) – to refuse to give something

    Customers are withholding payment because the products bought are not working.

  2. confidential / ˌkɒn fɪˈdɛn ʃəl / (adj) – kept in private

    The new employee is in trouble for sharing confidential information on the Internet.

  3. guarantee / ˌgær ənˈti / (v) – to assure or secure something

    The supplier’s contract guarantees the production of 3,000 items by next year.

  4. tip the scales / tɪp ðə skeɪls / (idiom) – to give more advantage to someone or something

    Our competitor’s scandal tipped the scales of sales in our favor.

  5. viable / ˈvaɪ ə bəl / (adj) – capable of growing or developing

    I put up my own business so that I can have a viable source of income.


Read the text below.

Tech giant Apple and telecommunications equipment company Qualcomm have ended their long-running legal disputes.

For years, Apple had purchased Qualcomm’s chips for the tech giant’s mobile devices. However, in 2017, Apple accused the chipmaker of overcharging. According to Apple, Qualcomm took advantage of its capacity as one of the few suppliers for cellular technology. The tech giant claimed that Qualcomm placed high prices on its modem chips, which enable phones to connect to mobile networks.

Qualcomm denied the accusation and fired back with a lawsuit, alleging that Apple breached the contract by withholding payment.

Apple and Qualcomm continued suing each other for two years over various allegations. One allegation was of Qualcomm accusing Apple of sharing confidential information with the chipmaker’s rival, Intel. Intel became Apple’s chip supplier when the legal disputes began.

After the two-year legal battle, the two companies announced their settlement. A press release published in April said that the settlement included an undisclosed amount of payment that Apple made to Qualcomm. Both parties agreed to drop all legal actions and closed a six-year licensing agreement, which will guarantee the launch of Apple’s first 5G iPhone in 2020. The agreement entails that Qualcomm will once again become Apple’s supplier of chips.

The Apple-Qualcomm settlement has not only ended one of the biggest legal conflicts in the technology industry but has also tipped the scales of power in Qualcomm’s rivalry with Intel.

Intel announced its exit from the production of 5G chips for smartphones following the settlement’s release. An Intel representative said that the company did not see viable income in producing 5G chips due to the terms of the Apple-Qualcomm agreement.

Viewpoint Discussion

Enjoy a discussion with your tutor.

Discussion A

• In your opinion, how can Apple and Qualcomm benefit from the settlement?
• If you were the owner of Apple, would you still choose Qualcomm as the company’s supplier of chips? Explain.

Discussion B

• What do you think are some possible causes of business-related conflicts? Discuss.
• What do you think are some ways to settle business-related conflicts? Explain.