Can Apple’s wake-up call for Qualcomm’s industry monopoly continue?

Apple is claiming $1 billion in patent licensing fees from Qualcomm. Currently, Qualcomm charges Apple nearly 4% in patent licensing fees for each iPhone. Based on the selling price of an iPhone of nearly $800, the fee Qualcomm charges is around $15. Based on Apple's annual sales of 200 million units, Qualcomm can earn nearly $3 billion in licensing fees, which is a considerable profit.

Apple has questioned this model, especially Qualcomm's refusal to refund the $1 billion it had previously promised. If Qualcomm had refunded the money secretly, it would have been fine, but now that Apple has made a big deal out of it, Qualcomm is in an awkward situation. It can either win the lawsuit, or if it fails, those authorized suppliers will attack it, and Qualcomm's revenue source from licensing may be lost forever.

Why does Apple take action against Qualcomm at this time?

First of all, Apple’s current situation is also very embarrassing. Everyone has high hopes for the iPhone 8, but the phone is constantly being exposed. Whether it can add luster to Apple is still an unknown. Coupled with the continuous upgrading of the Android system, the status of the IOS system is precarious. It is not impossible to arrange patent authorization in advance to stop the bleeding.

Qualcomm had just acquired Meizu at this time, and it was going to make great strides in 2017. How could Qualcomm be satisfied when Apple came to trouble it?

However, Apple has made a big deal out of this matter, and Qualcomm has no way out. If it wants to keep the patent license, it must win the lawsuit. Even mediation in the middle cannot cover up this matter. So, what can Apple get from this?

Of course, if Apple wins the case, it will get back the $1 billion promised by Qualcomm. In addition, it will no longer have to pay fees in the future.

Is Qualcomm's industry monopoly challenged?

After Apple entered the litigation stage with Qualcomm, it chose Intel as its second candidate manufacturer. Even if it fell out with Qualcomm, it would have a backup plan, at least it would not be without a chip manufacturer. However, Qualcomm is more concerned about the future. After being sued by Apple, Qualcomm's stock price fell sharply, and its market value evaporated by more than 10 billion in one day.

In fact, we are more concerned about whether Qualcomm's monopoly in the industry can continue. Now, we can find out why Meizu is reluctant to reconcile with Qualcomm. Once Qualcomm's patent licensing model is broken, many downstream manufacturers will inevitably be dissatisfied with its existing licensing model, which is something Qualcomm does not want to see.

Judging from the current situation, Qualcomm is not without a chance of winning. Even a drop in stock prices cannot immediately have a substantial impact on Qualcomm. Besides, Apple's lawsuit has not yet resulted in a conclusion, and there is no possibility of a settlement in the middle.

In this regard, we can see some clues. Apple sued Qualcomm for the $1 billion refund it had previously promised to give. Does this mean that Qualcomm had previously agreed to refund the money, but changed its mind later when it was time to give it?

This time point happened to be 2016 and 2017, when Apple was declining and Android was rising. Qualcomm's industry status rose rapidly and it gradually gained a say with Apple.

However, can the competition between Apple and Qualcomm bring opportunities to domestic smartphone manufacturers? The answer is yes. No matter which one wins, the domestic smartphone industry will inevitably usher in changes, either the position between them and Qualcomm will change, or the competition with Apple will have a turnaround.

However, no matter what the result is, domestic smartphone manufacturers need to do more than just wait and see. They should focus more on maintaining their own products and users. After all, products are the only magic weapon to win.

As a winner of Toutiao's Qingyun Plan and Baijiahao's Bai+ Plan, the 2019 Baidu Digital Author of the Year, the Baijiahao's Most Popular Author in the Technology Field, the 2019 Sogou Technology and Culture Author, and the 2021 Baijiahao Quarterly Influential Creator, he has won many awards, including the 2013 Sohu Best Industry Media Person, the 2015 China New Media Entrepreneurship Competition Beijing Third Place, the 2015 Guangmang Experience Award, the 2015 China New Media Entrepreneurship Competition Finals Third Place, and the 2018 Baidu Dynamic Annual Powerful Celebrity.