The battle with Apple made Imagination Tech crash, and it's now up for sale

Putting all your eggs in one basket is never a good idea. Unfortunately, this is exactly what the UK company Imagination Technologies did. 50% of its revenue used to come from Apple, as the British firm produced graphics processors for many Apple products, including the iPhone.

However, Apple decided to go its own way, and produce its graphics chips in-house. In April, the UK company announced that Cupertino notified it of its decision to stop using Imagination chips in 15 to 24 months time. The silicon manufacturer also said that it doubts Apple can go ahead with its plan without violating its patents, which led to it starting a “dispute resolution procedure” with the Cupertino behemoth in May.

All of this didn't work out too well for Imagination Tech, though, as the company lost 70% of its value following the events. Today, the British firm announced that it has put itself up for sale.

This shows the raw power companies like Apple have over the market, and how much their suppliers have to lose. If a single client backing out can drive a company to selling itself, it's normal for other supplier of the same caliber to ask themselves whether they will be next to become obsolete, as their star customer takes the process in-house.

via Reuters



1. nithyakr

Posts: 161; Member since: Jun 20, 2014

One Apple to Rule them all!!

6. sgodsell

Posts: 7430; Member since: Mar 16, 2013

It's understandable why Apple dropped them. Because the iPhone's GPU certainly isn't the fastest on the market. Even the SD 820 is almost twice as fast as the GPU in Apple's A10 fusion SoC, and that is when the SD 820 is using a QHD display vs Apple using a HD display that is pushing almost 4 times fewer pixels than a smartphone using a QHD display. Why else would Apple still be using a HD display for their iPhone 7. Especially when other OEMs are able to make and sell for a profit lower tier smartphones with full HD displays for around the $200 mark.

9. TechieXP1969

Posts: 14967; Member since: Sep 25, 2013

Very good point. But the fanboys don't know or care! But until Android has direct hardware access for games especially, iOS games still will be better, do to better code and the fact devs make the apps better on purpose.

2. nh1402

Posts: 138; Member since: Oct 30, 2013

Exactly as planned then by Apple.

3. L0n3n1nja

Posts: 1575; Member since: Jul 12, 2016

It's the same with any large corporation, companies need to adapt and need to have multiple revenue streams. Apple is screwed if the iPhone ever loses popularity, it's where the majority of their profits come from. Microsoft wouldn't last long without Windows. Intel and AMD are screwed if x86 gets replaced.

4. RebelwithoutaClue unregistered

You would be surprised all the businesses Microsoft is in. They aren't that depended on Windows earnings at all.

10. TechieXP1969

Posts: 14967; Member since: Sep 25, 2013

Well he is right. Even though Microsoft has other revenue streams, without windows and Office, they would lose almost 50% of their revenue. Windows alone is at least 60% of Microsoft's revenue with Office in 2nd place. Microosft 2015 - Microsoft 2013 - Apple 2015 - Now what has changed is. Since Office is now available on Android and iOS, Microsoft has found a way for Offfice to bring in more revenue, aside from being installed just on Windows. But Office on Windows is still the majority of money because Office on Windows costs more money. Plus buying Office, gets you online office for free. Without Windows, Microsoft would be hurting pretty hard, because most of their core business is based on Windows. So if Windows x86 or Windows Server drops, then Windows drops, which mean Microsoft services for the most part also drop. Because Exchange can work standalone without Windows and Outlook, but its suck without them,. I agree with YOU, that Microsoft has diverse its revenue to where they are not solely dependent on Windows like Apple is with the iPhone. But Windows is the basis for most of their core business and they loss in Windows usage, will also hurt their other revenue streams that depend on Windows usage, like Server, Office, Azure and Exchange and more. You both are right per se. But he is more right.

5. DFranch

Posts: 555; Member since: Apr 20, 2012

And that was probably their plan to make their own graphics chips. Announce their intentions ... wait for Imagination Technologies to go belly up ... Buy the company cheap. Now they are making their own graphics chips.

7. PhoneCritic

Posts: 1354; Member since: Oct 05, 2011

Maybe But other suitors may step in and take whats left and what is most important -Patents. I suspect either Google ( Alphabet ) or Samsung will be offering big bucks for the assets of IMAGINATION. Perhaps the board and CEO may hold a grudge against Tim Cook and company and decide to accept a lower bid from one of it competitor. One thing for sure, when you do business with Apple, its best to not depended on a single source of income. Apple as do all companies is here to make money for their share holders and would be more then happy to spend nothing on any other vendors tech but produce it in house in order to keep all the profits for itself. Apple has no loyalty to its partners- its normal business practices.

8. TechieXP1969

Posts: 14967; Member since: Sep 25, 2013

I hope Samsung buys them. I am sure the company won't allow Apple to buy them. Once the iPhone no longer has the PowerVR, iPhone graphics are gonna suffer big time.

11. PhoneCritic

Posts: 1354; Member since: Oct 05, 2011

Not necessarily since Apple is hiring graphic chip designers and spending to built its own GPU division. It might hire away all the talent from Imagination However, the kicker is it cannot get around the Patents and to be sure it will find its self embroiled in another patent dispute. I believe their next couple of devices for this year will include power VR GPU's but next year if Apple has not developed some sort of custom chip they will either employ Samsung's Exynos with Mail re-brand as the A12 or Nvidia there is no way they will employ a QC Adreno with the dispute they have with QC either way it will be interesting to see what they do.

12. XperiaFanZone

Posts: 2278; Member since: Sep 21, 2012

Only company that should buy them is Improbable.

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