The launch of the iPhone X has poured fire on the already volatile relationship between Apple and UK company Imagination Technologies. Revealing the new $999 iPhone last week, Apple chiefs proudly showed off their ‘most powerful’ A11 Bionic chip. It is the first of such chip’s to be designed in-house after Apple controversially dumped Imagination Technologies from its production.
While Imagination Technologies continues to fight the decision, claiming loss of future earnings, the UK company could also be lining up a new lawsuit. Many industry experts have highlighted a number of similarities between the A11 and previous Imagination technology. If that is proven to be the case then Imagination will no doubt turn to the courts for compensation once more and the bitter fall-out will own turn increasingly sour.
Analysts at Numis speculated that Apple will have to pay royalties to Imagination for technology in the new iPhone, despite Apple’s boasts about it being its own work. A spokesperson for Numis said: “It is noted on Apple’s developer website that the A11 GPU uses a key Imagination-patented approach called tile-based deferred rendering, which would indicate it will be a royalty-bearing chip.”
Imagination made chips for all of Apple’s phones until it was ditched earlier this year and told royalties would be wound down. But despite the setback, the British chipmaker Imagination Technologies posted an annual profit despite its ongoing fallout with Apple. The firm recorded a £2.4 million pre-tax profit with group revenue up 19 per cent to £145.2 million, overhauling a £29.4 million loss from the previous year.
Shares in the company plummeted by more than 60 per cent in April, when Apple controversially revealed that it would be pulling the plug on its partnership with Imagination Technologies at some point within the next two years. With royalties from Apple accounting for around half of the British chipmaker’s revenue last year, Imagination Technologies continues to contest Apple’s ability to create its own product without violating the companies agreement. The Hertforshire-based chipmaker believes that Apple’s plan to replace Imagination’s intellectual property – used in Apple product graphics processors – with its own version would violate the company’s patents.