Apple to stop potential iPhone ban in China with a software update
00:26, Dec 15, 2018
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Earlier this week, Qualcomm asked the Chinese government to ban the sale of some iPhone models in the country.
The ruling from a local court - which came as Washington and Beijing embark on sensitive trade negotiations - pivots the battle over patent fees to the world's largest mobile arena. "To address any possible concern about our compliance with the order, early next week we will deliver a software update for iPhone users in China addressing the minor functionality of the two patents at issue in the case".
The Chinese court's ruling handed an initial victory to Qualcomm, which is locked in a worldwide dispute with Apple over the licensing fees it charges for the use of technology that underpins all modern phone systems. The document was submitted in Mandarin with an English translation that Bloomberg verified.
The request adds the injunction could force Apple to settle with Qualcomm.
The company has also mentioned that the new 2018 iPhone models were launched in the month of September this year and they were not part of the case. Apple has argued its former supplier unfairly leverages its position as the biggest supplier of chips for smartphones to force payment.
The two U.S. companies are locked in a global dispute over licensing fees that Qualcomm charges for use of technology that the chip maker says underpins all modern phone systems.
Apple is arguing that a settlement with Qualcomm could be detrimental to China's mobile industry. Most have since struck an agreement with the USA company. Qualcomm has even fought back by going after Apple's manufacturing partners for continuing to produce iPhones that are said to be in violation of patents.
Well, whatever the thing is, the new order from the court has the potential to disrupt Apple's business in China.
The move will also negatively affect Chinese companies like Foxconn and its other vendors who manufacture the iPhone for Apple. The ban would take some time to implement and was appealed by Apple, but it could potentially cost Apple millions of dollars a day. The Chinese government "may suffer hundreds of thousands of tax losses" from the iPhone ban because of lost taxes from sales of the devices, it said, citing estimates of 50 million units sold in the country in 2017.
Apple's patent battle with Qualcomm in China has intensified this week, with Qualcomm seeking a broader ban and Apple claiming it has a workaround to avoid Qualcomm's patents.
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That notwithstanding, Kuo relays that there is a chance iPhone revenue could still increase year over year thanks to Apple's margin-friendly XS models. They try to get their inch somewhere. "My understanding is the ban should be enforced and could extend to new models based on recent Qualcomm court filings".
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