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Apple drops Imagination Technologies as supplier

Apple drops Imagination Technologies as supplier

Imagination said it will negotiate with Apple about possibility of licensing its technology to Apple, but there was no comment from Apple.

While Apple has always been close-mouthed about the technology that powers its devices, Imagination Technologies, the British chip designer has revealed that Apple has chose to stop using its intellectual property for GPU chips in less than two years time.

The iPhone maker is the biggest customer of Imagination Tech and holds about 8 percent stake in the company.

It remains unclear how Imagination will make up ground following Apple's departure, with the company once considered one the brightest prospects in United Kingdom technology.

If so, it wouldn't be the first patent and IP spat for Apple, which has an ongoing and long-running dispute with rival Samsung Electronics over the design of its smartphone and tablet computers. The firm "has reserved all its rights in respect of Apple's unauthorised use of Imagination's confidential information and Imagination's intellectual property rights", it added.

Apple has yet to release a statement of its own. The latest developments are an absolute disaster for Imagination Technologies, as about 50% of the company's revenues come from Apple.

The British company that designs the iPhone's graphics was dealt a huge blow Monday when Apple said it would stop using the firm's technology within the next two years.

But before all that happens, it seems Apple has some potential road blocks to navigate, if Imagine Technologies' statement is anything to go by. Thus far, Apple has relied on on Imagination Technologies for GPUs, but it's looking to drop that relationship as it picks up production on its own. For full-year 2017, its sales to Apple are expected to rise to about £65 million.

Bloomberg claims that Imagination Technologies and Apple are in talks over future license and royalty agreements. According to a CNBC report, Imagination develops chips that provides the graphics in iPhone, iPad and iPod products.

Imagination Technologies is uncertain Apple will be able to make the chip technology without breaking patents owned by the former though.

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