How much did Apple pay to settle with Imagination?

September 13, 2018 // By Peter Clarke
How much did Apple pay to settle with Imagination?
Apple has just announced its second applications processor since it said it would stop using intellectual property from graphics developer Imagination Technology and that it would eventually stop paying royalties. There have been no lawsuits.

Apple's application processors are for use inside its own smartphone products but Apple's statement, made in April 2017, that it was weaning itself of Imagination IP, caused the collapse of the Imagination stock price and forced the graphics company's eventual sale to a US equity company backed by Chinese state funds. However, circumstantial evidence now points to Apple having come to some sort of settlement with Imagination that frees it from the risk of being sued for patent infringement.

In April 2017 Apple said it would cease to pay to royalties to Imagination within a period of 15 months to two years and Imagination riposted in a statement that it believed "it would be extremely challenging to design a new GPU architecture from basics without infringing Imagination intellectual property rights and does not accept Apple's assertions."

Imagination did say at the time that it had held discussions with Apple over "potential alternative commercial arrangements for the current license and royalty agreement." The second half of 2017 or early 2018, with Imagination preoccupied with ensuring its own survival, would have been a good time for Apple to negotiate terms.

Imagination would not comment directly but a spokesperson said: "Apple remains our largest customer, and we value that relationship. There have been no legal proceedings of any kind." A source close to the company characterized Apple as a "customer of good standing."

The phrase "good standing" suggests there is no dispute. It would seem that either Imagination has changed its position on Apple's ability to design GPUs without using Imagination IP, or that Apple has settled. Indeed, depending on the terms, Imagination may still be able to benefit from any success Apple has with the processors inside its latest smartphones.

Next: Apple's A11 Bionic

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