Apple, Imagination battle continues with setup of new U.K. office

Apple Store in Sydney

Apple’s battle with its graphics tech supplier Imagination is getting even more heated.

The Cupertino-based tech giant is renting a 22,500 square-foot office in St Albans, England, a short distance from Imagination’s headquarters. Using this new space, Apple plans to develop its own graphics technology, thus forgoing the need to partner with Imagination.

This is leading to concerns that Apple will poach Imagination’s top talent and weaken the company as a whole. Apple has already hired a string of Imagination employees in recent months, including its former chief operating officer John Metcalfe.

As it stands, Apple has been licensing the PowerVR GPU technology from Imagination for use in the  processors of its various devices. In turn, Apple pays Imagination a royalty on every iPhone, iPad, iPod, Apple Watch and Apple TV it sells. The deal is incredibly lucrative for Imagination, as just over half of the company’s total revenue comes from these Apple payments.

This follows news from April that Apple was planning to stop using Imagination’s GPUs and begin development of its own tech within the next 15 to 24 months. However, Imagination said that Apple likely won’t be able to produce its own tech without violating its patent, and “unsatisfactory progress” was made on an alternative commercial arrangement between the two companies. “Imagination has therefore commenced the dispute resolution procedure under the licence agreement with a view to reaching an agreement through a more structured process,” the company said.

Futhermore, Imagination’s chief executive Andrew Heath said the company “[does not] believe this to be acceptable business practice nor in line with Apple’s own ethics statements regarding suppliers.”

Apple, meanwhile, says Imagination had been notified at least two years in advance of its plans to end the partnership. “We valued our past relationship and wanted to give them as much notice as possible to adapt their future plans,” a company spokesman said. “We’re disappointed in their response, which has been inaccurate and misleading.”

Image credit: Wikimedia Commons 

Source: The Telegraph