Apple demanded $1 billion for chance to win iPhone: Qualcomm CEO

SAN JOSE, California (Reuters) - Qualcomm sought to become the sole supplier of modem chips for Apple’s iPhone to recoup a $1-billion “incentive payment” that Apple insisted on, not to block rivals from the market, Qualcomm’s chief executive testified on Friday. The payment from Qualcomm to Apple - part of a 2011 deal between Apple and Qualcomm - was meant to ease the technical costs of swapping out the iPhone’s then-current Infineon chip with Qualcomm’s, CEO Steve Mollenkopf testified at a trial with the U.S. Federal Trade Commission.

While such a payment is common in the industry, the size of it was not, Mollenkopf said. Under the 2011 deal, Qualcomm was named Apple’s sole supplier of modem chips, which help mobile phones connect to wireless data networks, in exchange for which Qualcomm agreed to give Apple a rebate - the exact nature of which has not been disclosed. Apple could choose another supplier but it would lose the rebate, effectively increasing the cost of its chips. Antitrust regulators have argued the deal with Apple was part of a pattern of anticompetitive conduct by Qualcomm to preserve its dominance in modem chips and exclude players like Intel.

At a federal courthouse in San Jose, California, Mollenkopf testified that Apple demanded the $1 billion without any assurance of how many chips it would buy, which pushed the chip supplier to pursue an exclusivity arrangement in order to ensure it sold enough chips to recover the payment. Qualcomm was not aiming to block rivals like Intel, he said. “The risk was, what would the volume be? Would we get everything we wanted, given that we paid so much in incentive?” Mollenkopf testified.

Earlier in the day, Apple supply chain executive Tony Blevins testified that it was Apple’s practice to pursue at least two suppliers and as many as six for each of the more than 1,000 components in the iPhone. The company stopped trying to place an Intel modem chip in the iPad Mini 2 because losing the rebates on Qualcomm’s chips would have made the overall cost too high, he said. “They made it very unattractive for us to use another chip supplier,” Blevins said of the rebates. “These rebates were very, very large.”

https://www.reuters.com/article/us-apple-qualcomm-mollenkopf/apple-demanded-1-billion-for-chance-to-win-iphone-qualcomm-ceo-idUSKCN1P600H

>>4722879

Interesting..converting retail to capital, perhaps in an effort to pay for court proceedings which will eventually bankrupt them.

Mexico City pipeline hit by 'sabotage' amid crackdown on fuel theft

MEXICO CITY (Reuters) - A major fuel pipeline that supplies Mexico City remained closed after two ruptures in a single day, the president said on Friday, as the government works to stem shortages that have frustrated motorists and triggered economic risks. President Andres Manuel Lopez Obrador’s offensive against fuel robbers marks the leftist’s first attempt to tackle entrenched corruption since taking office on

Dec . 1.'''

Criminal groups have tapped pipelines and stolen tanker trucks carrying diesel and gasoline in the oil-producing country for years, costing the government billions of dollars.''' The government will assign 8,300 police and 1,400 security vehicles over the next 48 hours to safeguard fuel trucks so they can deliver to gas stations, said Mexico’s National Chamber of Freight Transport (CANACAR).

A key pipeline running from the port of Tuxpan in the Gulf coast state of Veracruz to Mexico City was shut down on Thursday night and repairs were underway, Lopez Obrador said on Friday. The pipeline was hit at daybreak on Thursday and repaired, only to suffer another rupture at 11 p.m., he said. “There’s sabotage,” he said. “Let’s see who gets tired first.”

The series of disruptions to the pipeline in recent days had caused shortfalls in supply for Mexico City and surrounding states. Cars lined up by the dozen at stations throughout the capital on Friday, many before dawn, fearing that the shortages that fanned into the megacity this week from nearby states could persist. Local television showed angry protesters blocking a major roadway in Mexico City’s Iztapalapa neighborhood.

The head of Mexico’s central bank said on Thursday that the economy and inflation rate could be negatively affected if fuel distribution problems persist. The closure of a pipeline from the Salamanca refinery in the central state of Guanajuato last weekend cut off supply for numerous gas stations. Lopez Obrador later said the military had discovered a 3-km (1.9 mile)-long “hose” that was funneling fuel out of storage tanks from the facility to a secret storage area.

The president also confirmed some congestion at key ports where imported motor fuels arrive, noting that some tanker ships were awaiting to discharge cargos, but he did not provide details. Bottlenecks at Mexico’s main Gulf coast and Pacific coast ports have increased during this week, and now prevent almost 10 million barrels of gasoline and diesel from discharging on schedule, further complicating distribution, according to Refinitiv Eikon data. On Tuesday, 24 vessels were backed up at ports, while that number has grown to 39 by Friday. Six tankers loaded with liquefied petroleum gas, used mostly for heating, are also waiting to discharge.

https://www.reuters.com/article/us-mexico-oil-theft/mexico-city-pipeline-hit-by-sabotage-amid-crackdown-on-fuel-theft-idUSKCN1P52C3?il=0