Splitting Up With Apple is a Chipmaker's Nightmare (engadget.com) 98
Apple is such a powerful company that, for third-party suppliers, it's hard not to become reliant on the cash that it pays you. Engadget adds: But when Apple says that it's done, choosing to move whatever technology you provide in house, the results can be really painful. Imagination Technologies is one such supplier, famously designing the iPhone's PowerVR graphics as well as pushing MIPS, a rival to ARM. But back in March, Imagination publicly announced that Apple was ditching it in favor of its own graphics silicon. Now, Imagination has revealed that it's going to take Apple to dispute resolution, maintaining that the iPhone maker used Imagination's IP without permission. It's the second chipmaker in recent months who believes Apple isn't playing fair, with Qualcomm counter-suing Apple in its own licensing dispute. Secondly, Imagination is going to have to sell off MIPS and Ensigma, two parts of its business that aren't as profitable as PowerVR. Gamers with long memories will remember that MIPS designed the CPUs that lurked inside the PlayStation, PS2 and Nintendo 64.
Nightmare on 1 Infinite Loop Street (Score:3, Funny)
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No it's not the law that you have to make every penny and crush you partners. And it's not even wise, because companies will become more reluctant to work with you in the future, and people will also dislike you for what you do, meaning some of them will buy from another company.
So no, it's not the law that you have to be a jerk just to make more money.
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And it's not even wise, because companies will become more reluctant to work with you in the future, and people will also dislike you for what you do, meaning some of them will buy from another company.
In the case of Apple, this just isn't true. Apple customers love Apple, no matter what they do, and will defend Apple's actions to the death if necessary. They won't buy from another company no matter what. They're also willing to make their Apple purchases their top priority, and would even take out a se
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On the flip side, if there are true business advantages to moving something in-house, should a company pass it up just to "be nice"?
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There's not necessarily a business advantage, it's that Apple wants to do everything itself, just like Sony did in its heyday. That's always been the devil's bargain with Apple, you can sell/license your stuff to them at a good rate, but the party only lasts as long as it takes them to move your magic dingus tech in-house. After that, you'd better not be in a position where you've committed 95% of your business to selling to Apple...
In terms of burning your suppliers, Commodore was notorious for doing thi
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There's not necessarily a business advantage, it's that Apple wants to do everything itself, just like Sony did in its heyday. That's always been the devil's bargain with Apple, you can sell/license your stuff to them at a good rate, but the party only lasts as long as it takes them to move your magic dingus tech in-house. After that, you'd better not be in a position where you've committed 95% of your business to selling to Apple...
Well, you just could have chosen not to do business with Apple. Then your company may have died years ago. Much better that way.
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not sure if its a sane long term strategy from apple, just look at the maps debacle... just because they have the cash to do every thing doesn;t mean they will do it better or heck just as good. MS is another one of those examples, how many times has MS tried to screw over oem and builders... every time crawling back.
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Well in terms of the hardware side, there is a reason that Apple is designing their own stuff. Originally Samsung supplied the SoC for the iPhone which Apple felt was adequate but wasn't exactly everything they wanted. But here is the problem: Apple could have asked more customizations but that would have cost a lot more money and time. Samsung is in the business of making mobile SoCs for many companies not just Apple so they can't just design something that Apple wants and ignore the rest of the industry.
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I'm not sure how deciding to stop buying somebody's product makes you "not to be trusted". It sucks for PowerVR, but why should Apple be obligated to only ever buy mobile GPUs from one company?
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Apple is building the rep that they only contract with you long enough to get a good hands on with your parts, then abruptly cutting ties and making it themselves.
I'm not sure why so many folks think that a business relationship is the same thing as a lifelong blood oath. If you can get the same or better performance out of chips by sourcing them in house, and it's cheaper, it only makes sense to do so, and would practically be demanded as part of their fiduciary responsibility to their stockholders.
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They licensed GPUs from Imagination for more than a decade, you make it sound like this was a hit-and-run. Business relationships don't last forever, and it wasn't exactly abrubt considering they've been gradually replacing chunks of the GPUs with in-house designs for some time now: at this point only the fixed-function hardware is still designed by Imagination. Is it any surprise that they now want to move the last chunk over to an in-house design, like they did with their CPUs years ago?
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Apple is quickly building a reputation with other tech companies that they are not to be trusted. The company I work for is developing a smaller version of what we already make, with the original intention of getting them into iPhones, that view has shifted in the last year or so. Now we are avoiding interaction with Apple like the plague.
Then your management isn't very smart.
If you know the game going-in, then you can certainly reap the rewards of selling to a company with huge sales, but not get so reliant on that one customer that you over-expand, and then collapse when the party's over.
And BTW, every single company even in the same ballpark as Apple is going to be exactly the same way. Afterall, that's what they teach in $FAMOUS_MBA_SCHOOL$".
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And at one time "Nobody ever got fired for choosing IBM" was a saying. Not so much anymore however. apple is the new IBM.
So when has anybody ever said "Nobody ever got fired for choosing Apple"?
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On the flip side, there are often very heavy non-exclusive agreements that are pushed on you when you supply to someone like Apple or MS. So you end up being nothing more than a division of their company that can be cut off any day. Proceed at your own risk.
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Did you read about what happened to that sapphire glass company a couple years back? Apple made them sign a deal that they couldn't sell their glass to other customers.
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Did you read about what happened to that sapphire glass company a couple years back? Apple made them sign a deal that they couldn't sell their glass to other customers.
Apple didn't make them do anything.
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Did you read about what happened to that sapphire glass company a couple years back? Apple made them sign a deal that they couldn't sell their glass to other customers.
No they didn't. Which you can easily tell by the fact that the company made furnaces, not glass. At least before Apple asked them to make sapphire glass for them with their own furnaces.
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I'm not liking Apple right now. Destroying several companies in their quest to gain more cash.
Errm, how exactly is Apple crushing anybody here? They should be about where they were before they started making lots of money by selling to Apple, probably in a much better position actually, since the market has grown massively since then.
Unless of course either A) Apple saved them by doing business with them back then, or B) their product is too bad for Apple's competition to buy. Then they are blaming Apple for either not dragging their dead body along any more, or for no longer buying something from t
One Imagines (Score:5, Insightful)
Re:One Imagines (Score:5, Interesting)
Notably though, Imagination Tech's important patents have just expired. There's a reason that nVidia and AMD both suddenly implemented tile based renderers, and Apple suddenly decided they could viably produce their own GPU.
Nvidia and Tile Renderer (Score:4, Informative)
There's a reason that nVidia and AMD both suddenly implemented tile based renderers,
Actually, Nvidia has had their own TBR patents for quite some time :
- Nvidia bought up 3DFx for their patents and their engineer back when that one went bankrupt.
- Before that, 3DFx had bought up Gigapixel, among other for their TBR patents, to be used in future product (forgot the code name) - and HSR (hidden surface removal) tech to be applied much earlier in then current product (in the then VSA-100 / Voodoo4/5/6 and in the upcoming Rampage / Spectre)
So Nvidia indirectly acquired TBR patents.
Though for the record, they were more interested in the know-how and engineer which where working on the Rampage GPU ("3DFx Spectre" cards) due to programmable pixel shaders being all the rage, and retained them to work on GeForce FX (speculation backthen that probably the pun in the name was intended... )
So in theory, they could have moved into the field much faster than ATI / AMD.
(But back at the Rampage / GeForce FX era, there where some area were TBR was problamatic : e.g. some transparency (i.e.: simple alpha-blend, back then) couldn't be handled in a single pass easily. So probably they decided not to bother.
Given that modern games work with tons of subsequent passes (transparent materials cause diffraction/distortion in a separate pass of a pixel-shader), I would suspect that it's not that much a problem anymore).
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Imagination doesn't make chips, so no, they didn't sell Apple chips, and Imagination hasn't yet giving Apple permission to use their technology (going forward, that is, since Apple has said it won't be paying for it). Really, the whole situation bears no resemblance to the Qualcomm case in the slightest.
At play here is that Imagination has, up to now, licensed their technologies to Apple, which Apple has used in its custom-designed chips for a few years. Apple is now claiming that their custom designs no lo
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At play here is that Imagination has, up to now, licensed their technologies to Apple, which Apple has used in its custom-designed chips for a few years. Apple is now claiming that their custom designs no longer rely on Imagination's technology, so they're going to stop paying. Imagination is understandably asking how that's even possible, given that the new chips presumably work the same as the old ones, which means that they likely rely on Imagination's tech.
In the arena of mobile GPUs, Imagination certainly isn't the only company so it's not like they are the only choice. Qualcomm makes their own proprietary GPU. nVidia and ARM also offer designs to be licensed. I would think Apple may rely on their architectural license with ARM and leverage that into designing a Mali based GPU. But let's see the details.
Re:Hopefully someone will acquire MIPS (Score:4, Interesting)
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What I don't understand is this from TFS:
Imagination is going to have to sell off MIPS and Ensigma, two parts of its business that aren't as profitable as PowerVR
I've seen similar things stated by other companies over the years. Oh, they're struggling, so they're selling off less profitable parts. That's the way it's usually stated, rather than something like, "selling off non-profitable divisions" or something like that.
If it's profitable, at all, then there's no reason to sell it. The only reason to sell it would be if they weren't calculating "profit" correctly. If it's bringing in any profit, then selling it is only going
Proving it will be hard (Score:2)
Unless they take the lid off Apples new graphics chip and can point out hardware design similarities and possibly extract the microcode. However doing so would violate apples copyright so they could counter sue.
As usual, only the lawyers will win.
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It's nothing the industry doesn't do already. Decapping chips, putting them under a microscope, and selling the high-res phots (And/or providing expert analysis) is a pretty brisk buisness and there are a lot of companies that specialize in doing just that.
Really you'd be dumb not to peek at what your competitors are doing.
Re: Proving it will be hard (Score:1)
Going for a settlement with Apple? (Score:5, Interesting)
For Qualcomm and Imagination, I would think that their contracts with Apple were pretty iron-clad. Apple didn't become one of the biggest companies on the planet by signing deals that wasn't in their favour. Potential for abuse by Apple when the contracts were drawn up aside, I would think that the contracts are pretty solid and Apple knows exactly what it's rights are and has protected itself.
This means that the only recourse for (former) suppliers is to go after Apple, primarily in the court of public opinion, to see if there's a chance for a settlement to avoid Apple's public reputation being damaged. Although after Jobs, I don't see how it could get any worse on that front.
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Re:Going for a settlement with Apple? (Score:4, Informative)
I've had the misfortune of dealing with Apple on the business side, and they just make stuff up as they go along. They will make all manner of completely unreasonable demands, which have nothing at all to do with the contract, and just threaten to rip up said contract if they don't get what they want. Not to mention they will get a bug up their ass about enforcing one part of the contract one week, then the next week they couldn't care less about that, but this other minor inconsequential provision is now crucial, and they'll club you over the head with the threat of ripping up the contract if you don't comply. They'll claim they have "statistics" or some such that shows you aren't in line with other similar companies, but you'll never actually get to SEE the evidence, because it's confidential or some other nonsense. You'll be assigned an Apple minder, who will typically be completely unavailable if you try calling/emailing them, but will miraculously find time in their busy schedule if it's to call/email you about something you're not doing right. Some of their mid to upper level managers will even be verbally abusive if you have face to face meetings, and they'll even ambush you. They'll invite you to Cupertino, saying it's a friendly little junket to tour the Apple facilities, except you'll be ushered into a conference room where a number of execs will accuse you of a bunch of things.
Essentially, Apple's M.O. is to just threaten to rip up your contract if you don't drop trou, bend over, and take a good ass pounding whenever they feel like giving you one. The little bits you see in stories like this don't even represent the tip of the iceberg, they're like the dusting of snow on the iceberg's surface.
Samsung (Score:2)
For Qualcomm and Imagination, I would think that their contracts with Apple were pretty iron-clad. Apple didn't become one of the biggest companies on the planet by signing deals that wasn't in their favour. Potential for abuse by Apple when the contracts were drawn up aside, I would think that the contracts are pretty solid and Apple knows exactly what it's rights are and has protected itself.
This means that the only recourse for (former) suppliers is to go after Apple, primarily in the court of public opinion, to see if there's a chance for a settlement to avoid Apple's public reputation being damaged. Although after Jobs, I don't see how it could get any worse on that front.
Um, this is the company that ended up with its most important parts supplier becoming its biggest competitor. They are still trying to detach themselves from Samsung, and despite having $1/4 trillion in the bank cannot get hold of the best displays in the industry.
Given that Mr Cook was in charge of all this supply chain stuff before being anointed by Jobs, why would you assume their other supply arrangements were put together any better?
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At the time Samsung was chosen as a supplier, Android didn't even exist in the public sphere. The company hadn't been bought by Google, and no one could have predicted that someone would make it into a competitor and license it to handset manufacturers. So, if you consider not being able to predict the future a screwup, you must think you're Moses.
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So, if you consider not being able to predict the future a screwup, you must think you're Moses.
I used to work with Moses. Guy over-engineered everything. All this time I thought he was just being a little bit pendantic but now I see that he was just predicting the future.
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I used to work with Moses. Guy over-engineered everything.
Building a ship by making a wooden box is the opposite of over-engineering.
If push comes to shove (Score:2)
What is rumoured is that apple developed pretty much their whole graphics core, very different from imagination's, while the front end and some fixed functions are still imagination's IP. Either they are sure that by the time of implementation those will be developed IP free as well, or not encumbered by patetnts anymore.
Of course engineers and lawyers are fallibe, and if Imagination surveys the graphics core with a fine enough comb, they may find some nuggets of their IP there. Or be a pebble in the shoe o
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Both of these companies may have perfectly valid complaints, but even if they don't I could see them deciding to give it a shot anyway. Suing the deepest (non-governmental) pocket in the world has to be pretty high on any aggressive corporate attorney's bucket list, and it's probably pretty easy to convince the C suite that throwing a few million into legal fees is a good bet, since the odds of convincing Apple to settle just to shut down the negative PR are probably pretty good.
And it makes even more sen
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Apple didn't become one of the biggest companies on the planet by signing deals that wasn't in their favour. Potential for abuse by Apple when the contracts were drawn up aside, I would think that the contracts are pretty solid and Apple knows exactly what it's rights are and has protected itself.
That assumption does not explain the multibillion-dollar lawsuits that have been going back and forth between Apple and Samsung, Apple and Qualcomm, all of the above companies and international regulatory agencies, etc. Nobody's really protected until a judge rules it so.
Typical (Score:3, Interesting)
This is one of the oldest tricks in the business book.
Get a vendor to supply OVER 35% of their entire business to you alone, then cut them off (or demand massive reductions in price) and when they falter because of the drop in revenue, you either purchase them outright for a song, or scoop up their IP when they go out of business due to Bankruptcy.
Wal*Mart is famous for doing this, so was Sears back when they had non-insane management.
I worked for a company that flat-out refused business from Sears if it exceeded more than 35% of their total income for this reason.
Many years after I left them new management discarded that idea, and lo and behold within 5 years they went bankrupt when a customer demanded a 85% reduction in prices, then let them die and bought up their IP out of Bankruptcy Court for a song and moved all manufacturing to Guatemala.
Imagination Technologies should have seen this coming.
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What you're saying is that they lacked the Imagination to foresee their Technologies being taken away?
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Hey everyone! Look! A fool giving tips to a moran!
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Their patents look to be expiring. There really isn't an IP to grab that isn't free for anyone to grab anymore. If you don't like this business practice, you better be for a more robust patent system with more protections for the inventor. Allowing your company to become so dependent on a single customer is simply bad management anyway. Let those companies die.
Set-top boxes still use MIPS chips (Score:2)
I've got a couple of Zgemma Linux-based satellite TV set-top boxes and they use a MIPS chip, so it's not just used in ancient game consoles. The boxes are very nice to tinker with (Web interface, ssh, loads of pre-built plugins) and I'll put in a good word for Wooshbuild - a firmware image that makes the box interface look like S*y HD or S*y Q.
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I believe most WiFi routers to this day still use MIPS CPUs.
and that would be... (Score:5, Insightful)
And that would be the reason my father told me never to let one client dedicate more than 30% of my business. It's also why I told my father that reliable clients sometimes get heavy discounts, to offset the lack of sales/collection efforts, which keeps them from rolling their own.
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>And that would be the reason my father told me never to let one client dedicate more than 30% of my business.
I have worked for companies that died because they failed to do this. One logistics and one IT.
When one supplier dominates your business, they're not a supplier... they're your master. It's just a matter of how gentle they are. And as soon as they decide they can do better, they'll kill you off without a second thought.
> It's also why I told my father that reliable clients sometimes get hea
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That said, Apple probably worked with the company to get expertise in buildin
Does Apple need better management? (Score:2)
Steve Jobs's worst decision was promoting Tim Cook [qz.com] (Nov 2, 2016) "Quote: Why Tim Cook is the new Steve Ballmer".
Remove Tim Cook as CEO of Apple. [change.org] (Oct 31, 2016) Quote: "Many products are announced in one quarter and released in another quarter."
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Fact is that Apple's business is running better than ever before.
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Change.org isn't even a news site.
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Read the explanation. (Score:2)
I'm searching for some depth of understanding.
"magical pipeline" (Score:2)
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Maybe Tim Cook is not a sufficiently capable CEO. Remove Tim Cook as CEO of Apple. [change.org] (Oct 31, 2016) Quote: "Many products are announced in one quarter and released in another quarter."
I guess you are one of the 108 people who signed that petition since October. And that also answers your question.
Many other possible conclusions (Score:2)
MIPS was in game consoles, sure, but (Score:3)
What about Silicon Graphics machines? I find it odd the article doesn't even mention SGI. I still have an O2 R12K, an Octane 2 R14K, and an Indigo 2 Impact R10K.
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Probably because Octanes and Indigos sold in the thousands and consoles in the tens or hundreds of millions.
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This was my thought, when MIPS is mentioned, I automatically thing SGI. Then I realized that I'm old (not really) and that my memory is even longer than they assume their readers have. Of course, this is slashdot, so my expectation was that the user base that's left here (since I doubt they're adding to their user base) is as old or older than I am.
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My thought to, and of course that also makes for the link to OpenGL and 3D graphics, which IMHO was what SGI was often best known for.
MIPS was also in: (Score:2)
The parent post mentions SGI iron.
but also let's not forget multitude of routing equipment (CISCO was/is a big user of MIPS processors).
Also, the Chinese have developed MIPS processors for use in anything from laptops to SuperComputers... (Loongson/Godson).
MIPS cores are also used in many cheapo routers/modems
who should I feel sorry for? (Score:2)
Between Apple and these billion dollar companies Apple's business has created, my only reaction to this is... why is the taxpayer wasting money and resources on resolving these lawsuits? They should work out their differences in private mediation.
World's smallest violin. (Score:2)
It's playing just for Imagination.
Hopefully, as more of these patents expire, a Vulcan based open source GPU will emerge.
Difficulty (Score:3)
Hopefully, as more of these patents expire, a Vulcan based open source GPU will emerge.
As the numerous past failures of attempts at opensource GPU or even opensource graphic cards have shown, making a functional and competitive graphic card is EXTREMELY difficult.
As always (Score:1)
Eggs in one basket (Score:2)
When you build your company based on income mainly from one giant customer, you are eventually going to lose.
Walmart did the same thing (Score:2)
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Yep. Worked at a company selling stuff to Apple. You had to prove you had the spare manufacturing capacity to deliver their highly custom chip to even compete. The losers who didn't win that spot on the board were left with a manufacturing floor that was half or more idle until at least the following year. A lot of their special requirements made the final chip totally un-sellable to anyone except Apple, and you often had to turn away business to keep that manufacturing capacity open.
It was clear a few