Facing allegations of monopolistic trade practice over its controversial exclusivity agreement to supply iPhone modem chips, Qualcomm has claimed the deal was meant to recoup the massive $1 billion ‘incentive payment’ that the Apple was seeking in return for an exclusive order.
In a testimony to the US FTC, Qualcomm CEO Steve Mollenkopf claimed that the agreement was only being sought because Apple gave no guarantee about the volume of chips it would be ordering.
Qualcomm agreed to offer Apple rebates on its modems chips, but only if it was selected as the sole supplier. There was no bar on Apple pursuing other suppliers, but in doing so, it would have lost the discounted rate.