How Qualcomm shook down the cell phone industry for almost 20 years

Enlarge (credit: Getty / Aurich Lawson)

In 2005, Apple contacted Qualcomm as a potential supplier for modem chips in the first iPhone. Qualcomm's response was unusual: a letter demanding that Apple sign a patent licensing agreement before Qualcomm would even consider supplying chips.

"I'd spent 20 years in the industry, I had never seen a letter like this," said Tony Blevins, Apple's vice president of procurement.

Most suppliers are eager to talk to new customers-especially customers as big and prestigious as Apple. But Qualcomm wasn't like other suppliers; it enjoyed a dominant position in the market for cellular chips. That gave Qualcomm a lot of leverage, and the company wasn't afraid to use it.

Read 70 remaining paragraphs | Comments