Apple demanded $1 billion for chance to win iPhone: Qualcomm CEO

January 12, 2019. By Stephen Nellis. SAN JOSE, California (Reuters) – Qualcomm sought to become the sole supplier of modem chips for Apple’s …
FILE PHOTO: Woman checks her phone at a flagship Apple store at Iconsiam shopping mall in Bangkok
FILE PHOTO: A woman checks her phone at a flagship Apple store at Iconsiam shopping mall in Bangkok, Thailand November 9, 2018. REUTERS/Soe Zeya Tun

January 12, 2019

By Stephen Nellis

SAN JOSE, California (Reuters) – Qualcomm sought to become the sole supplier of modem chips for Apple’s iPhone to recoup a $1-billion “incentive payment” that Apple insisted on, not to block rivals from the market, Qualcomm’s chief executive testified on Friday.

The payment from Qualcomm to Apple – part of a 2011 deal between Apple and Qualcomm – was meant to ease the technical costs of swapping out the iPhone’s then-current Infineon chip with Qualcomm’s, CEO Steve Mollenkopf testified at a trial with the U.S. Federal Trade Commission.

While such a payment is common in the industry, the size of it was not, Mollenkopf said.

Under the 2011 deal, Qualcomm was named Apple’s sole supplier of modem chips, which help mobile phones connect to wireless data networks, in exchange for which Qualcomm agreed to give Apple a rebate – the exact nature of which has not been disclosed. Apple could choose another supplier but it would lose the rebate, effectively increasing the cost of its chips.

Antitrust regulators have argued the deal with Apple was part of a pattern of anticompetitive conduct by Qualcomm to preserve its dominance in modem chips and exclude players like Intel.

At a federal courthouse in San Jose, California, Mollenkopf testified that Apple demanded the $1 billion without any assurance of how many chips it would buy, which pushed the chip supplier to pursue an exclusivity arrangement in order to ensure it sold enough chips to recover the payment.

Qualcomm was not aiming to block rivals like Intel, he said.

“The risk was, what would the volume be? Would we get everything we wanted, given that we paid so much in incentive?” Mollenkopf testified.

Earlier in the day, Apple supply chain executive Tony Blevins testified that it was Apple’s practice to pursue at least two suppliers and as many as six for each of the more than 1,000 components in the iPhone.

The company stopped trying to place an Intel modem chip in the iPad Mini 2 because losing the rebates on Qualcomm’s chips would have made the overall cost too high, he said.

“They made it very unattractive for us to use another chip supplier,” Blevins said of the rebates. “These rebates were very, very large.”

(Reporting by Stephen Nellis; Editing by Sandra Maler and Sonya Hepinstall)

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Apple demanded $1 billion from Qualcomm for chance to win iPhone

(Reuters) – Apple Inc asked for $1 billion as an “incentive payment” from Qualcomm Inc in order for Qualcomm to become the supplier of modem chips …

SAN JOSE, California (Reuters) – Qualcomm sought to become the sole supplier of modem chips for Apple’s iPhone to recoup a $1-billion “incentive payment” that Apple insisted on, not to block rivals from the market, Qualcomm’s chief executive testified on Friday.

FILE PHOTO: A woman checks her phone at a flagship Apple store at Iconsiam shopping mall in Bangkok, Thailand November 9, 2018. REUTERS/Soe Zeya Tun

The payment from Qualcomm to Apple – part of a 2011 deal between Apple and Qualcomm – was meant to ease the technical costs of swapping out the iPhone’s then-current Infineon chip with Qualcomm’s, CEO Steve Mollenkopf testified at a trial with the U.S. Federal Trade Commission.

While such a payment is common in the industry, the size of it was not, Mollenkopf said.

Under the 2011 deal, Qualcomm was named Apple’s sole supplier of modem chips, which help mobile phones connect to wireless data networks, in exchange for which Qualcomm agreed to give Apple a rebate – the exact nature of which has not been disclosed. Apple could choose another supplier but it would lose the rebate, effectively increasing the cost of its chips.

Antitrust regulators have argued the deal with Apple was part of a pattern of anticompetitive conduct by Qualcomm to preserve its dominance in modem chips and exclude players like Intel.

At a federal courthouse in San Jose, California, Mollenkopf testified that Apple demanded the $1 billion without any assurance of how many chips it would buy, which pushed the chip supplier to pursue an exclusivity arrangement in order to ensure it sold enough chips to recover the payment.

Qualcomm was not aiming to block rivals like Intel, he said.

“The risk was, what would the volume be? Would we get everything we wanted, given that we paid so much in incentive?” Mollenkopf testified.

Earlier in the day, Apple supply chain executive Tony Blevins testified that it was Apple’s practice to pursue at least two suppliers and as many as six for each of the more than 1,000 components in the iPhone.

The company stopped trying to place an Intel modem chip in the iPad Mini 2 because losing the rebates on Qualcomm’s chips would have made the overall cost too high, he said.

“They made it very unattractive for us to use another chip supplier,” Blevins said of the rebates. “These rebates were very, very large.”

Reporting by Stephen Nellis; Editing by Sandra Maler and Sonya Hepinstall

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Robinhood, the start-up upending stock trading, goes after banks with 3% checking and savings …

Popular stock trading app Robinhood, which disrupted Wall Street with zero-fee transactions, is taking aim at an even bigger market: banks.

Bhatt, who co-founded Robinhood in 2013 with Vlad Tenev, said the yield is not a “teaser rate.” Given the direction from the Federal Reserve, which is slowly raising interest rates, Bhatt said the 3 percent rate should be sustainable.

They are not necessarily going to make money on these checking and savings products right away. Robinhood is taking a page out of Amazon’s playbook by shunning profits for growth.

“Amazon built an entire business around a strategy that makes that long-term investments in financial services,” Bhatt said. “We fully intend to make money off of this but we do not need it to be profitable on day one.”

The start-up will split revenue from debit card transactions in a partnership with Mastercard. It will also earn interest off customer assets it holds, which are invested in government-grade securities like U.S. Treasurys.

For stock trades, it generates revenue by taking a fraction of a cent per dollar from each trade order as well as collecting interest on customer deposits. Robinhood also makes money on a paid subscription service called Robinhood Gold, launched in September 2016.

Robinhood has faced criticism over its revenue model, especially considering its founding ethos, which some have categorized as “anti-Wall Street.” According to a report from Bloomberg, the company makes almost half of its revenue from selling its customers’ orders to high-frequency trading firms, or market makers, like Citadel. The practice, known as payment for order flow, is not uncommon on Wall Street. Almost all retail brokerages employ it.

Robinhood issued a statement after the report, saying like the rest of the industry, it “participates in rebate programs which help customers get additional price improvement for their orders by creating competition amongst the exchanges and liquidity providers who fill the orders, often resulting in superior execution quality.”

Robinhood also said in the statement it does not sell personally identifiable data of any kind to execution venues.

“Robinhood does not, has not, and will not sell customer information,” the company said.

WATCH: JP Morgan is breaking into mobile trading

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Marlboro Maker Altria Acquires 45-Percent Stake in Cronos Group. What Does That Mean for the …

The deal follows beverage manufacturer Constellation Brands’ $3.8-billion investment in Canopy Growth Corp., another milestone cannabis deal.

As wholesale cannabis prices continue to drop and states issue regulations to manage cultivation facilities’ energy usage, growers will need to find ways to operate more efficiently. A big piece of the efficiency puzzle is lighting, and utility rebates and incentives are available to help cultivators purchase and install more efficient lighting systems.

Older lighting technologies tend to generate more heat and have higher wattage than more modern LED fixtures, although LEDs’ high price point leaves growers wary of making the investment, according to Corinne Wilder, director of sales operations for Fluence Bioengineering. However, utility rebates and incentives can help cultivators mitigate the difference in cost between LEDs and other lighting technologies, such as high-pressure sodium (HPS) fixtures, for example.

“It’s a wide range of different rebates that are available, but it’s really important for mitigating that incremental cost between HPS and LED,” Wilder says. “HPS can typically be around $350 a fixture. … LED can be anywhere from $1,000 to $1,500. So, it could be three to five times more expensive, and any type of utility rebate that helps get that cost down and help customers afford the fixtures on the front end is important.”

Some states have issued rules to manage how much energy cannabis cultivation facilities use. Massachusetts, for example, allows recreational cannabis cultivators of 10,001 square feet and above to use a maximum of 36 watts per square foot, Wilder says. Lighting manufacturers can often help growers design lighting and implement strategies to meet these specifications, and utility rebates can help make the technology affordable.

Utility companies often offer these rebates and incentives to reduce the impact on their grid, Wilder says. Horticulture facilities use greater amounts of electricity, which can be problematic if a utility provider’s grid has a limited electrical load.

Utility companies have recognized that they can gain energy savings from incentivizing these types of businesses to use less electricity. “It’s a choice of basically the utility company saying, ‘Do we incentivize these existing companies of ours to use less electricity than they already are, or do we invest in building new power plants in order to provide additional load to the system?’” Wilder says. “Almost always, it’s a better idea for them to incentivize people to use less electricity than it is to build more infrastructure.”

According to Wilder, these are the most common utility rebate and incentive questions.

What kinds of utility rebates and incentives are available for cannabis cultivators?

There are two types of rebate programs that utility providers typically offer: prescriptive rebates and custom rebates.

Prescriptive rebates: A prescriptive rebate is a standard offer that says, for example, if a grower replaces one, 1,000-watt HPS fixture with a 600-watt LED fixture, that grower will receive x number of dollars for each fixture replaced.

Custom rebates: A custom rebate usually requires a cultivator to submit paperwork, lighting designs and a completed workbook, for example, that shows the exact number of older lighting fixtures compared to newer fixtures. The rebate is usually higher with custom rebates, but more work is required, Wilder says.

Rebates vs. incentives: A rebate typically implies that the monetary reward is provided after the purchase of the lighting fixture, while an incentive generally means that cultivators must file an application for the program before they purchase the fixtures. Growers working with a utility incentive program should file for the program four to six weeks before ordering the fixtures, Wilder says, and they should be prepared to compile documentation and lighting designs beforehand.

What is the process for cannabis cultivators to take advantage of utility rebates and incentives?

The first step to getting involved in a utility rebate or incentive program is for growers to ask either their lighting manufacturer or utility provider (or both) if they qualify for an existing program, Wilder says. “I would recommend first asking the lighting manufacturer if they know of any utility rebates in their particular area, and/or then contacting their own utility company and seeing if they qualify.”

If none of the utility providers in a particular area offer rebate or incentive programs, lighting manufacturers can sometimes make a case for one, Wilder adds. “So, basically, we would just go in and make the case for that particular customer and show what other utility companies are doing across the U.S. This gives the utility the data they would need in order to consider a special situation, custom rebate offering.”

Most utility rebates and incentives are monetary based, Wilder says, where a utility company provides a dollar amount to offset the cost of a grower installing a new lighting system. A rebate usually comes in the form of a check four to six weeks after a final inspection is conducted by the utility provider to ensure that the fixtures have been installed and match the original lighting design provided at the beginning of the process.

Typical rebates are somewhere between 20 and 40 percent of the cost of the lighting system, but in certain areas can be upwards of 75 percent. It’s all based on location, Wilder says.

How can cannabis cultivators benefit overall from utility rebates and incentives?

Not only does taking advantage of a utility rebate or incentive help cover some of the cost of a new lighting system, but using more energy efficient lighting can help cultivators decrease operational expenses going forward, Wilder says. This also includes savings on HVAC costs because more efficient lighting uses less BTUs and gives off less heat, she adds.

“So, it’s not just the lighting benefit that they save with reduction in total amount of watts, but it’s also the total amount of BTUs that are put into the air, so there’s less cooling that they have to provide for their grow,” Wilder says.

And switching to LED fixtures often eliminates the need to replace bulbs, which means growers can spend less time and money on materials and labor in that area, as well.

What does the future hold for energy efficient lighting?

A forthcoming DesignLights Consortium (DLC) certification will eventually allow utility companies to look at a DLC-certified lighting fixture and know that it meets energy efficiency guidelines, Wilder says.

“I like to describe it as the Energy Star certification for LED fixtures,” she says. “So, it’s one of these certifications that utility companies can look to and say, ‘Oh, it’s DLC-qualified? Great, I don’t have to do my own testing to make sure that this is a quality, energy efficient product.’”

DLC certification will be available for utility providers to start using in mid-October to early November, Wilder says, and DLC-certified lights will be rated based on efficiency ratings and photosynthetic photon flux (PPF) (how many photosynthetically active photons are being emitted from the light source every second), among other criteria.

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Snowflake Announces Data Sharing Rebate Program

Read More: Fluor Uses IBM Watson to Deliver Predictive Analytics Capability for Megaprojects. Lacework, a Snowflake customer, delivers a cloud …

Snowflake continues to enable the Data Economy by simplifying and reducing the cost for all customers to use the only cloud-built data warehouse as the Data Sharehouse

Snowflake Computing, the only data warehouse built for the cloud, announced a rebate program to reward customers who use Snowflake Data Sharing with their external “data consumers” by reducing their monthly costs and potentially driving their Snowflake expense to zero. Snowflake Data Sharing, aka the Data Sharehouse, allows customers to share any part of their data among their internal business units, with their ecosystem of partners and customers, and with other external data consumers.

Qualified customers who use Snowflake Data Sharing will automatically be eligible for the rebate program beginning December 1. Snowflake customers, who share data as “data providers” with external organizations (data consumers), will automatically receive a credit rebate equal to 10 percent of their data consumers’ usage when those consumers perform operations on a data provider’s shared data inside Snowflake’s data warehouse-as-a-service. Snowflake customers already get the most powerful, flexible and cost-effective data warehouse. Now they get additional savings, while securely sharing governed data in real time with qualified, third-party data consumers.

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Snowflake Data Sharing is one of many innovations to support Snowflake’s mission of enabling every organization to be data-driven. Other Snowflake innovations include instant elasticity, per-second pricing and multi-cloud availability. Modern data sharing functionality, which is uniquely available on Snowflake, allows organizations of any size to participate in the Data Economy via a data-sharing network enabled by Snowflake.

Snowflake customer Blackboard is a technology company that provides software, tools and services to educational institutions.”Snowflake Data Sharing is having a profound effect on how we approach analytics for teaching, learning and institutional performance,” Blackboard’s Sr. Director of Software Engineering,Jason White said. “We’re able to seamlessly share data across our organization and with our business partners and customers. The fact that we can do this in real time, without having to copy or move data sets, accelerates our business processes and makes us more agile and responsive.”

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Lacework, a Snowflake customer, delivers a cloud security platform that combines active cloud resource monitoring, advanced analytics and smart visualization. “With Snowflake Data Sharing, we’re constantly innovating because we’re able to easily forge data sharing relationships for the benefit of everyone involved,” Lacework’s Chief Product Officer, Dan Hubbard said. “The Lacework and Snowflake partnership based on data sharing is a true win-win experience for both Lacework and our customers.”

Snowflake CEO Bob Muglia recognizes the benefits of the multitude of use cases The Data Sharehouse provides. “We’re excited to offer our customers a truly unique data sharing experience that will revolutionize how organizations distribute, consume and even monetize data,” Bob Muglia said. “Anyone using Snowflake can avoid the significant time, expense and frustration of complex traditional approaches to sharing data within and beyond the organization. The cost benefits of our new rebate program are additional incentives for customers to use Snowflake to become data-driven and participate in the Data Economy.”

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