Qualcomm Facing Off With FTC in Antitrust Trial That Kicks Off Today

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With the intense ongoing legal battle between Qualcomm and Apple, it's easy to forget that Qualcomm is also facing an FTC antitrust lawsuit for using anticompetitive tactics to remain the main supplier for baseband processors for smartphones.

The FTC hasn't forgotten, though, and FTC lawyers are in a Northern California courtroom before well-known judge Lucy Koh, who also presided over the Apple-Samsung legal fight.


Lawyers for Qualcomm, the FTC, Apple, and other manufacturers have gathered as the trial commences, with the FTC set to argue that Qualcomm refused to provide chips to OEMs without a patent license, refused to license its technology to rivals, and set exclusive deals with Apple.

Manufacturers like Huawei and Lenovo will testify that Qualcomm threatened to disrupt their chip supply during licensing negotiations, forcing them into signing deals.

The FTC first filed a complaint against Qualcomm in January 2017, which was actually the catalyst for Apple's own lawsuit against the company just a few weeks later.

In that complaint, the FTC said that Qualcomm uses its position and its portfolio of patents to impose anticompetitive supply and licensing terms on cell phone manufacturers, impacting its competitors.

Part of the complaint addressed a deal with Apple in which Qualcomm required Apple to exclusively use its modems from 2011 to 2016 in exchange for lower patent royalties. Qualcomm is also accused of refusing to license its standard-essential (FRAND) patents to competing suppliers and implementing a no license, no chips policy to drive up royalty payments beyond what's fair.

Qualcomm attempted to get the FTC's lawsuit against it dismissed, but in June, Judge Koh ruled that the lawsuit would proceed on the basis that the FTC adequately demonstrated that anticompetitive tactics were being used by Qualcomm.

In its defense, Qualcomm has claimed the FTC is using a "flawed legal theory" and has misconceptions about the mobile technology industry. "We look forward to defending our business in federal court, where we are confident we will prevail on the merits," Qualcomm said in a statement in January 2017.

As the FTC trial begins, Apple and Qualcomm's legal battle has also been escalating. As of today, Apple has pulled the iPhone 7 and the iPhone 8 in Germany after Qualcomm won a preliminary injunction in the country.

Qualcomm also won an import ban on older iPhone models in China, which Apple sidestepped through a software update that addressed functionality said to infringe on Qualcomm patents.

Tags: FTC, Qualcomm, antitrust

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Honor 10 Lite to Soon Launch in India: Is It a Better Pick Over the Xiaomi Mi A2 and Realme 2 Pro?

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One Analyst Thinks the Next iPhone Will Have a USB-C Port, Smaller Notch, and Touch ID Under Display

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At least one new iPhone released in 2019 will sport a USB-C port, smaller notch, and the return of Touch ID under the display, according to Jean Baptiste Su, Vice-President and Principal Analyst at consulting firm Atherton Research.


Su shared his prediction in a Forbes column about Apple lowering its revenue guidance for the first quarter of its 2019 fiscal year:

Although we believe that Apple will release a re-designed iPhone X in 2019—with a smaller notch, a fingerprint reader (Touch ID) under the display, and a USB-C port—it will still lack the extensibility (memory card), the battery life, the lightning-fast charging capability, and the camera quality of Android flagship smartphones while being more expensive.

This is the first Apple rumor we've ever heard from Su, and the Forbes contributor network has published its fair share of questionable content about Apple in recent years, so treat this rumor with a healthy dose of skepticism. Many analysts not named Ming-Chi Kuo simply make guesses — and not always educated ones.

Let's imagine these features prove to be true, though, and examine what that would mean for the next iPhone:

• USB-C: For many years, critics believed Apple would never switch to USB-C on its iOS devices, and then it did exactly that with the 2018 iPad Pro. Will the iPhone follow suit this year? Notorious supply chain publication DigiTimes seems to think so, so Su is not alone in his prediction.
  
  With many of the latest Macs equipped with USB-C or Thunderbolt 3 ports, which share the USB-C connector design, moving from Lightning to USB-C on the iPhone would create one primary I/O standard across not only Apple devices but hundreds of other electronics.
  
  The switch from Lightning to USB-C would almost certainly cause an uproar among at least some Apple customers, who already had to replace their docks, cables, and other accessories when Apple switched from its 30-pin dock connector to Lightning back in 2012.
  
  It's also worth considering that Apple has emphasized a wireless future, so one possibility is that the Lightning connector sticks around until there is no connector whatsoever.
  
  
• Touch ID under the display: This one is hard to believe. Face ID is more secure than Touch ID and seems like Apple's authentication method of choice going forward, starting with the iPhone X and expanding to the iPhone XS, iPhone XS Max, and iPhone XR last year.
  
  Kuo agrees, noting that Apple doesn't plan to return to Touch ID in any capacity with its 2019 iPhone lineup back in September.
  
  
• Smaller notch: This one is certainly plausible. As the iPhone design continues to evolve, Apple will surely find ways to reduce the size of the notch, even if only by a fraction of a millimeter.

It's only January, so we're still early in the rumor cycle about 2019 iPhones. Over time, we should get a clearer picture about what to expect from more reputable sources like Kuo. To date, we've heard the next versions could feature a triple-lens rear camera, Face ID improvements, slightly thinner displays, and more.

Related Roundup: 2019 iPhones

Tags: Touch ID, USB-C, Jean Baptiste Su

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The $599 Deal On The Pixelbook Is Back And Too Good To Miss

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Apple Faces Second Class Action Lawsuit Threat Over Failing to Warn Investors About Slowing iPhone Demand

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New York-based law firm Bronstein, Gewirtz & Grossman has announced it is investigating whether Apple and certain executives violated U.S. federal securities laws after the company lowered its revenue guidance by up to $9 billion for the first quarter of its 2019 fiscal year earlier this week.


The law firm is conducting the investigation on behalf of AAPL shareholders, with potential for a class action lawsuit, and encourages affected investors to obtain additional information and assist the investigation by visiting its website.

Bernstein Liebhard LLP, another New York-based investor rights law firm, launched a nearly identical investigation of Apple earlier this week.

Apple CEO Tim Cook in a letter to shareholders this week disclosed that Apple's revenue for the quarter just ended will be approximately $84 billion, significantly lower than its original guidance of $89 billion to $93 billion, due to "lower than anticipated iPhone revenue, primarily in Greater China."

Both investigations contrast the positive language that Cook has previously used when speaking about China with the weaker language used in his letter to shareholders this week, in which he said Apple "did not foresee the magnitude of the economic deceleration, particularly in Greater China."

On January 2, 2019, Apple revealed that its revenue for the first fiscal quarter of 2019 would be more than 7% lower than it expected because of "[l]ower than anticipated iPhone revenue, primarily in Greater China, [which] accounts for all of [Apple's] revenue shortfall to [its] guidance and for much more than [its] entire year-over-year revenue decline."

Conversely, on November 1, 2018 CEO Tim Cook stated during Apple's fourth quarter 2018 conference call, that "[o]ur business in China was very strong last quarter. We grew 16%, which we're very happy with. iPhone in particular was very strong, very strong double-digit growth there."

In other words, both law firms are investigating whether Apple failed to warn investors about slowing iPhone demand, particularly in China.

AAPL closed at $142.19 on Thursday, down 36 percent from a closing price of $222.22 on November 1, immediately prior to Apple's last earnings report. As a result, Apple's market valuation has plunged from a peak of around $1.1 trillion to under $700 billion, falling behind rivals Amazon, Microsoft, and Google.

Tag: AAPL

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Apple Pulls iPhone 7 and iPhone 8 Models From Sale in Germany Amid Legal Battle With Qualcomm

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Yesterday chipmaker Qualcomm announced that it posted €1.34 billion in security bonds required for the chipmaker to enforce a preliminary injunction on select iPhone models in Germany, after a court in the country found Apple to be infringing Qualcomm patents related to power savings technology in smartphones.


The injunction blocks the import and sale of infringing iPhone models in Germany while Apple appeals the verdict, and accordingly, Apple has now pulled the iPhone 7, iPhone 7 Plus, iPhone 8, and iPhone 8 Plus from sale in the country.

Those four iPhone models are no longer available to order via Apple.com in Germany and they have also been pulled from sale at all 15 of Apple's retail stores in the country until further notice. The latest iPhone XS, iPhone XS Max, and iPhone XR models are not impacted by the verdict and remain available.

Qualcomm's equivalent of $1.5 billion in security bonds will cover the cost of the lost sales if Apple successfully appeals the verdict.

Apple was also ordered to recall infringing iPhone models from third-party resellers in Germany, according to Qualcomm, but as noted by TechCrunch and Reuters, some German resellers continue to sell iPhone 7 and iPhone 8 models.

In a statement, Apple said this verdict is another "desperate attempt" by Qualcomm to distract from the "real issues" between the two companies:

Qualcomm's campaign is a desperate attempt to distract from the real issues between our companies. Their tactics, in the courts and in their everyday business, are harming innovation and harming consumers. Qualcomm insists on charging exorbitant fees based on work they didn't do and they are being investigated by governments all around the world for their behavior. We are of course disappointed by this verdict and we plan to appeal. All iPhone models remain available to customers through carriers and resellers in 4,300 locations across Germany. During the appeal process, iPhone 7 and iPhone 8 models will not be available at Apple's 15 retail stores in Germany. iPhone XS, iPhone XS Max and iPhone XR will remain available in all our stores.

Apple and Qualcomm are engaged in a major legal battle spanning multiple countries. The spat began in early 2017 when Apple sued Qualcomm for an alleged $1 billion in unpaid royalty rebates, just days after an FTC complaint alleging Qualcomm engaged in anticompetitive patent licensing practices.

In defense, Qualcomm has said its "innovations are at the heart of every iPhone" and "enable the most important uses and features of those devices," adding that it "simply is untrue that Qualcomm is seeking to collect royalties for Apple innovations that have nothing to do with Qualcomm's technology."

Qualcomm has also accused Apple of making misleading statements, sharing its trade secrets with Intel, and numerous other infractions.

Qualcomm sought a similar injunction on iPhones in the United States, unsuccessfully, and in China, where a court did issue an import ban on select iPhone models over patent infringement last month. Apple made some tweaks in iOS 12.1.2 to address the patents and continues to sell all iPhone models in China.

Tags: Qualcomm, Germany

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Apple Offers 'New Year Special Edition' Beats Solo3 Wireless Headphones in Chinese New Year Gift Guide

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In addition to its Back to University promotion launched in Australia, New Zealand, and Brazil today, Apple has also unveiled a pair of special edition Beats Solo3 Wireless Headphones as part of its Chinese New Year gift guide.


Available in Silver Wing Grey, the New Year Special Edition Beats headphones, which are currently only available in China, continue a new Apple trend of decorating Beats in unique celebratory decals.

In October last year, Apple unveiled limited edition Mickey Mouse Beats Solo3 models to celebrate the 90th anniversary of the famous Disney cartoon character.

Previous to that, Apple released a Decade Edition model of the Solo3 as a salute to the longevity of the Beats brand, which the company acquired in 2014.

As well as the new Beats, Apple's annual Chinese gift guide is also promoting the latest iPhone, Apple Watch, and iPad Pro models under the banner of family reunion over the holiday period.

Tag: Beats

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