It’s been a very rocky few years for Imagination Technologies.
Previously, Apple used GPUs in its iPhones and iPads that were designed by Imagination, but Apple moved to its own internal chip designs starting with the iPhone X in 2017 after Cupertion told Imagination Technologies in 2017 that it would stop using its intellectual property in new products within two years.
When Imagination Technologies, then a public company, announced the loss of Apple as its biggest customer, its stock plummeted. It has since been acquired by Canyon Bridge, a Beijing-backed private equity firm.
Then, on January 2, 2020, Imagination Technologies’ surprisingly announced a new, company-saving deal with Apple in a brief press release:
Imagination Technologies (“Imagination”) announces that it has replaced the multi-year, multi-use license agreement with Apple, first announced on February 6, 2014, with a new multi-year license agreement under which Apple has access to a wider range of Imagination’s intellectual property in exchange for license fees.
Hannah Boland for The Telegraph:
Ron Black is clearly on his guard. “All we can say about Apple is what was in the press release,” the Imagination Technologies boss recites cooly, sitting in a drafty boardroom at the company’s headquarters in Kings Langley, Hertfordshire.
Black’s cagey attitude is understandable … In April 2017, Apple said it was dropping the British company’s designs, to take the development in-house, [and] Imagination’s future looked pretty bleak. Things quickly got ugly…
Then, earlier this month, Imagination revealed it had reached a new deal with Apple… It left some scratching their heads. Why was a tie-up coming now? Had Imagination been handed a worse deal, perhaps having had to offer more concessions or take a smaller cut of royalties? Had Apple decided it just wasn’t worth developing the graphics chips in-house? “I don’t think it’s necessary to be public,” says Black firmly, when pressed about the terms of the deal. In any case, it’s hard to argue that such a partnership is not welcome news for Imagination…
MacDailyNews Take: Ron Black saves another one.
If Apple is soaring with their own development, they wouldn’t need Imagination, right? Either Apple struggled internally, costing time, money and missing deadlines, or Apple was never serious about their own designs just a better deal… that’s a lot of down time to strike another deal, when no one would have known if the company would even have survived…
The most logical answer is the former argument. Keep the ship lean and tight Tim…
What concerns me is that this could have been handled better. It could have been handled in a way that did not lead to an immediate crisis for Imagination Technologies. It could have been handled in a way that did not lead to a big loss of jobs at the company or a crash in the stock price. If handled properly, the transferring of value over to Canyon Bridge, a Beijing-backed private equity firm, would never have happened.
If Apple had really wanted to pick up Imagination Technologies on the cheap, then it could have done so when the stock plummeted. Instead, it is now paying royalties to China.