Apple to update iPhones in China to avoid ban on sale of older phones

Apple told that it made about $13.3 billion on iPhone sales in China in the first quarter of 2018, meaning it would lose millions of dollars a day if it had to stop selling certain phones in China

Apple said it would update the software of iPhones in China to try to resolve a legal dispute that threatens to stop the company from selling older iPhones in the country.

Apple and its longtime chip supplier, Qualcomm, have been fighting in court over Apple’s use of Qualcomm’s technology. On Nov. 30, a Chinese court ruled Apple must immediately stop selling seven older iPhone models in China because it infringed on two Qualcomm patents.

But Apple has not stopped selling those iPhones there. The company has argued the phones are not subject to the ruling because they are running new software that was not discussed at trial.

On Friday, Apple said in a statement that it would update its iPhones in China early next week “to address any possible concern about our compliance with the order.” Apple said its update would change the iPhones’ software so it did not infringe on Qualcomm patents, which relate to switching between apps and changing the size and appearance of photographs. 

Don Rosenberg, Qualcomm’s executive vice president and general counsel, said in a statement that Apple was already violating the court’s order.

“They are legally obligated to immediately cease sales, offers for sale and importation of the devices identified in the orders and to prove compliance in court,” he said. Qualcomm this week asked Fuzhou Intermediate People’s Court to enforce its injunction.

Apple also asked the court to reconsider its ruling. The company told the court it made about $13.3 billion on iPhone sales in China in the first quarter of 2018, meaning it would lose millions of dollars a day if it had to stop selling certain phones in the country.

The court’s preliminary injunction barred Apple from selling the iPhone 6S, the iPhone 6S Plus, the iPhone 7, the iPhone 7 Plus, the iPhone 8, the iPhone 8 Plus and the iPhone X in China. The ruling did not apply to Apple’s three newest iPhones: the XS, the XS Max and the XR.

A lawyer for Qualcomm in China told the Financial Times this week that the company would also seek bans on sales of Apple’s newest iPhones, claiming they were also infringing Qualcomm’s patents.