Qualcomm Cease Fire Tops Big Week in Apple News
It was a big—and costly—week for Apple. And most of it centered on Apple’s Qualcomm troubles.
On Tuesday, Apple and Qualcomm announced an end to their patent dispute and that they would enter into a six-year licensing deal that would let Apple use Qualcomm chips in future iPhones and other devices. The agreement—and their decision to end all litigation worldwide—was viewed as a victory for Qualcomm, which reportedly netted up to $6 billion from Apple to settle the dispute.
Apple’s week didn’t only center on Qualcomm. Amazon took a big step towards challenging Apple Music with a new, free music-streaming service. Additionally, Apple’s iPhone shipments last quarter may have been lower than the company had expected, according to one supply chain report.
It wasn’t all bad news. Apple also sold more iPhones in the U.S. in the first quarter than any other handset maker, according to a new study. TF International Securities analyst Ming-Chi Kuo said big things are ahead for this year’s iPhones.
Read on to learn more about all of the biggest Apple news from the past week.
Apple and Qualcomm have settled a two-year patent dispute. The companies said on Tuesday that they’d ended all litigation and have signed a six-year patent-licensing agreement that allows Apple to bundle Qualcomm chips in its devices. Although terms of the deal were not made public, UBS analyst Timothy Arcuri said that he believes Apple paid up to $6 billion to settle with Qualcomm. He also estimates that Apple will pay royalties of $8 to $9 per iPhone to include Qualcomm chips in them. Here’s a look at all of the winners and losers in Apple’s Qualcomm battle from my Fortune colleague Aaron Pressman.
Apple’s AirPods are under attack. The $159 diminutive wireless earbuds may face a new competitor in Microsoft. Earlier this week, tech news site Thurrott revealed that Microsoft is working on AirPods competitors that would be small enough to fit snugly in customer ears, wireless connectivity, and work with the company’s virtual personal assistant Cortana for voice control. There’s no telling yet when they may join AirPods on store shelves.
Apple might miss Wall Street’s expectations on iPhone shipments, according to researcher OTR Global. The company said this week that 18 Asia-based supply chain executives it had polled about Apple’s purchases from them showed that Apple had shipped 37 million to 42 million iPhones during its fiscal second quarter ending in March. That’s slightly behind the 40 million to 45 million units Wall Street expects. OTR Global said Apple experienced “poor demand for the new iPhone XR and iPhone XS models” during the period.
In a note to investors this week, TF International Securities analyst Ming-Chi Kuo said Apple would upgrade the front-facing camera in this year’s iPhone from the 7-megapixel sensor in 2018 iPhones to 12-megapixels. Kuo said Apple also plans a triple-lens camera array in this year’s iPhones, according to Apple-tracking site 9to5Mac. He expects Apple to announce the new iPhones this fall.
Apple’s iPhone was the top-selling smartphone in the U.S. in the first quarter with 36% market share, researcher Consumer Intelligence Research Partners (CIRP) said this week. Samsung was in second with 34%, followed by LG with 11% and Motorola with 10%.
Amazon took a big leap in its fight against Apple Music and Spotify this week. The company announced a free streaming-music service that will let users access millions of songs in its Amazon Music playlists. For now, Amazon is testing it on smart home devices that use its Alexa voice assistant. All signs are pointing to a broader release on non-Alexa devices in the future. Apple Music and Spotify both cost $9.99 monthly. A free streaming-music alternative from Amazon could be a threat to both.
Apple’s upcoming streaming video service, Apple TV+, has signed another top executive. Danielle DePalma, who most recently served as the executive vice president of worldwide digital marketing and research at film studio Lionsgate, will lead Apple TV+’s film and television series marketing, according to Deadline. DePalma left Lionsgate in January.
This is Fortune’s latest weekly roundup of the biggest Apple news.
One more thing…Beyonce’s album Lemonade is coming to Apple Music for the first time. Beyoncé released Lemonade in 2016 exclusively on Tidal, a competing music service her husband Jay-Z owns. It’ll be available on Apple Music on April 23.
