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Apple's Graphics Chipmaker Does Away With Two Businesses; Takes Grievances With Cupertino To Court

By Grace Anilado , May 05, 2017 04:30 AM EDT
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Apple is under a lot of pressure right now due to the heightened anticipation of their tenth-anniversary overhaul of the iPhone. However, Cupertino has one more problem to deal with aside from their design conundrums. A key supplier, Imagination Technologies, is taking the tech mammoth to the court regarding graphics chips.

Imagination Technologies is a British firm that has been supplying Apple an integral part of their devices for years. But Cupertino now thinks they can no longer entrust an important portion of their iPhones and iPods to a third-party supplier. That is why they announced recently that the company is breaking up with their long time graphics partner, TechCrunch writes.

This news has Imagination Technologies crumbling, as their partnership with Apple makes the bulk of their revenues. Because of that, the British company is saying that Cupertino cannot manufacture their own graphics processors without infringing on their existing patents.

At first, the British firm tried to draw a new licensing agreement. Unfortunately, they made no progress in that regard, which is why they have decided to begin a formal dispute process. If this move succeeds, then they will be able to acquire licensing revenues from the U.S.-based tech behemoth.

Furthermore, the impending departure of Apple has hurt Imagination Technologies' shares. Their stock is now down roughly 65 percent since. On top of that, the chipmaker is letting go of two of its businesses, according to The Verge. One is related to embedded processors while the other has to do with licensing patents concerning mobile and IoT.

Depending on the outcome of this dispute, Imagination Technologies may have to shutter down. Apple is a major stockholder of the company and that is why their move came as a surprise to the industry. They also have no plans of acquiring the firm, making their withdrawal from the business a big threat to the survival of the company.

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