Imagination Technology starts dispute process with Apple

“Imagination Technologies said it had started a ‘dispute resolution procedure’ with Apple, its biggest customer, after failing to resolve a standoff over licensing between the two companies,” Paul Sandle reports for Reuters.

“Imagination said in April that Apple had notified the British firm it was developing its own graphics chips and would no longer use Imagination’s processing designs in 15 months to two years time,” Sandle reports. “Apple has used Imagination’s technology in its products from the time of the iPod, and it receives royalties from every sale of an Apple device containing its designs, including the iPhone and iPad.”

“It said on Thursday it had been unable to make satisfactory progress with Apple on an alternative commercial arrangements for the current license and royalty agreement,” Sandle reports. “”Imagination has therefore commenced the dispute resolution procedure under the license agreement with a view to reaching an agreement through a more structured process,” it said.”

Read more in the full article here.

MacDailyNews Take: The dance continues.

UBS: Imagination likely to see Apple royalties slashed, then cease altogether – April 19, 2017
It’s getting even tougher to be an Apple supplier – April 19, 2017
Without Apple, Imagination Technologies’ PowerVR has no future – April 10, 2017
Apple steps up homegrown GPU plans with London hiring spree – April 9, 2017
Why Apple’s ditching of Imagination is critical for the future of the iPhone – and maybe even the Mac – April 5, 2017
Apple aims for more control, less cost as it accelerates in chip design – April 5, 2017
Apple could look to buy Imagination Technologies after ditching the chip firm, share price plunge – April 4, 2017
Imagination Technologies’ shares collapse after Apple dumps UK chip designer – April 3, 2017
Apple nabs top talent from iPhone 7 GPU chipmaker Imagination Technologies – October 13, 2016
After failed takeover talks with Apple, Imagination Technologies sells stake to state-owned Chinese company – May 9, 2016
Apple in ‘advanced talks’ to acquire Imagination Technologies for PowerVR GPU – March 22, 2016


  1. Apple may not have any obligation to IT, but this move by Apple is not graceful. Apple may have isolated itself from further contracts with other companies which, ultimately, could negatively impact product development. Lotsa luck, Apple, yer gonna need it.

    Tim Cook destroying relationships and building a wall around the Mother Ship. And he complains about Trump. You’re a loser, Tim.

    1. Any company that sells its product to another company knows that, in a free market, its customers have other choices. If I sell you my widgets, you are free to go to another manufacturer who makes better or cheaper widgets, or you can start making your own widgets if that is in your financial best interest. In the absence of a contractual obligation, I do not have any vested interest in your continued business.

      Tim Cook does not have a fiduciary obligation to keep doing business with Imagination Technologies. He does have a fiduciary obligation NOT to do business with them if some alternative is better for Apple. Imagination knows that, and so does every other potential Apple vendor.

      The lesson for other companies here is not to avoid doing business with Apple, but to avoid building a business model that assumes Apple has no other choices. That assumption may have led Imagination into complacency that ultimately made their latest and greatest offering less attractive to Apple than one they could develop in-house themselves.

      I am surprised that anyone can think that maintaining relationships with vendors should be a higher priority for Apple than producing the best product at the best price.

      1. The political angle is the possible fallout as was mentioned which is other Apple developers will see Apple as a potential enemy so Apple knows that it needs to watch the politics.

    2. What?…not graceful?
      I can think of no other example of a company getting 15 months to two years notice from their major customer. Totally unreal expectations versus an unexpected polite warning that “You need to expand your customer base and here is a time schedule to help you”.)

  2. IT is scrambling. This too will fail. They lost Apple, and there is nothing they can do other than offer Apple a better deal than what Apple thinks it can get elsewhere. This also goes for Qualcomm. Their deal suck donkey balls and if they think they can force Apple to do business as usual, they need to get off the weed pipe.

    Like said above. Apple has a responsibility to strive for a better financial deal. You will see this more and more.

    1. No one has explained how Q. can demand payment on IPs it does not own and how Apple agreed to this scheme in the first place. It happened under Jobs.

      1. I recall an issue where Apple was using Qualcomm to shield them from additional upstream licensing because the tech was in the chip. I can’t recall all the details. It was like Q licensed tech to make the chip and Apple bought the chip. So Apple shouldn’t have to license the tech as it would mean double dipping.

        It’s like you going to the grocery store to buy soy sauce and Monsanto coming to your house and asking for a license because your soy sauce contains their IP.

      2. Qualcomm does own the intellectual property at issue in its dispute with Apple. Apple has never disputed that. Apple agreed to license the patents because Qualcomm owns them and no modem can communicate with the cellular network without them. That is what being a “standards essential patent” means.

        The dispute isn’t about whether Qualcomm owns the patents or about whether Qualcomm has the duty to license them on “fair, reasonable and non-discriminatory” terms. Both parties agree to all that. The only question is whether the price demanded by Qualcomm is actually fair or nondiscriminatory.

Reader Feedback

This site uses Akismet to reduce spam. Learn how your comment data is processed.