Apple and Qualcomm’s Billion-Dollar War Over an $18 Part
bloomberg.com
bloomberg.com
The big issue with Qualcomm IP practice is that they don't charge IPR on the modem function, but over the whole device. So put the same modem in a cheap phone, or in an expensive laptop, and the IPR will be very different. This is really charging IPR on a lot of value completely unrelated to the modem.
Historically, the cellular/3GPP world was very phone centric. The specs were for a phone, and the chipset was really the core of the phone. At that time, charging cellular IPR on the device embedding the chipset was reasonable: the device was just a phone, with all the intelligence coming from the chipset.
We're obviously no longer living in such a world. But Qualcomm keeps this practice, as it's very profitable for them and their dominant position let them do it (so far). Apple is mad at this, as most of the value of a smartphone is outside of the modem part nowadays (even more for a PC). Other device makers hate it too, but don't have the muscle to go against QCOM and can't afford alienating them. Europe is looking into it too, and will issue a recommendation that cellular IPR is charge only on the modem subsystem, not the including device (basically, Apple position). It will start as a recommendation, but could become law later on.
So it looks like it's QCOM against everybody else. Considering the money involved, I'm sure that QCOM has a pretty fat budget to push their angle. Hello Bloomberg ;)
Read up on Token ring vs Ethernet to get some understanding of the history in this area.
Pot, meet kettle. Apple charges 30% at the App store, whether I want to sell an app for $1 or $1000.
Also, if Apple wanted, they could package the modem separately. Sell it for $50. Again, this mirrors Apple's advice to Samsung to build triangle phones since Apple patented a rectangle with rounded corners. Suddenly, clunky workarounds are bad. Quelle suprise.
I really can't feel sorry for Apple. Live by the sword, die by the sword. Must be nice to be an Apple IP lawyer. They win no matter what happens.
Apple can do whatever it wants on its own App Store. It's their device and they aren't a monopoly nor is it anti-competitive for them to charge a high fee on their own store.
But Qualcomm IP is part of the LTE standard on the express condition that they will license their share of LTE mandatory features fairly. I don't think it's fair to take a percentage cut of the whole package price for an IP license that's part of a global standard.
And I don't feel sorry for Apple. I feel sorry for all the other small manufacturer and companies suffering from this situation, but that are too small to make things move on their own. Apple and Samsung may not have the purest of interest in this debate, but if they move things in what I believe is the right direction, I'll be happy.
Or, if we're dictating what's a fair price.. can we at least force Intel, AMD and other relevant parties to license X86 patents?
Because this is a synthetic market the government explicitly created and maintained through patent legislation.
In this case. Apple has a history of demanding extortionate patent licensing fees for incredibly obvious ideas.
You seem to be missing the bigger picture. The attack on Qualcomm is against the company, not the patents. Qualcomm snapdragons are the only competitive ARM chips against Apple's A series.
Apple is trying to destroy Qualcomm and monopolize the market. That's not going to help the little guys you claim to care so much about.
Apple A series tech is destroying the Qualcomm's snapdragons just fine without any need for legalities.
Are you suggesting that Qualcomm is using its licensing fees to support an unprofitable Snapdragons? Overall a confusing argument.
I already addressed it. The poster is repeating the point. That doesn't make it more valid.
>Apple A series tech is destroying the Qualcomm's snapdragons just fine without any need for legalities.
You might want to review world wide market share numbers before you try to defend that statement.
>Are you suggesting that Qualcomm is using its licensing fees to support an unprofitable Snapdragons?
I'm suggesting Apple is using litigation expense as an avenue to destroy the business of their competitor, again. Apple has much deeper pockets than Qualcomm. It's very simple math.
When ? I am only aware of one situation in their history i.e. Android where Apple has sought an ongoing royalty.
> Apple is trying to destroy Qualcomm and monopolize the market
What ? Apple is never going to sell their CPUs to their competitors. They are a product company not a components vendor so not sure what market you are referring to. Also Intel sells modem components as well.
>What ? Apple is never going to sell their CPUs to their competitors.
Who said Apple would sell CPUs to competitors? You don't monopolize a market by having competitors. Not real ones anyway.
But Apple is not doing that. It is keeping that competitive advantage in house.
Whether you like Apple or not, you have to understand their business model before you criticize it. Apple doesn’t care about competing with component manufacturers. Not even a little bit.
Apple learned this the hard way in the 90s. Don’t compete on price, and don’t compete on specs. Apple happens to be winning on specs right now. The snapdragon procs are not even close to the A-series in performance. But that wasn’t always the case.
This is about maximizing profit. Not about putting anyone out of business.
And that's exactly where you're looking at this wrong. it's not just Apple that loses out because of this, it's consumer's at large.
Likewise, the same thing happens with apps, consumers must pay more money for apps which will have less revenue to invest in themselves.
That's the thing about unfair economic practices, it never just hurts the people directly involved, but also the massive amount of people indirectly involved.
Not really equivalent though. Apple advertises and makes the whole app available on the App Store, delivers the whole app from their infrastructure, manages upgrades and back end services for the whole app, provide access to millions of customers and handle the financial transaction for the full cost of the app. It seems reasonable they get a percentage of the whole app’s price.
Meanwhile Qualcomm only own a few patents on a tiny sliver of the circuitry of one component for one function of the device.
Qualcomm spends around 5.5 Billion every year in R&D or 23% of net sales. For comparison, apple spends a paltry 2.2% of its net sales on R&D. Dry up Qualcomm's net sales and the R&D will dry up too.
All the most crucial wireless patents (the really fundamental ones) have already expired. Why doesn't Apple design another, competing system around Qualcomm's patents and license it for free? The answer is that it takes a decade and tens of Billions of dollars.
Apple has the money, but it's cheaper to work the courts over so they pay less. If Apple were the ones who built 4G, you can be very sure they'd be charging at least as much as Qualcomm.
Remember, Apple thought the look of their iphone was worth $40 per device when suing Samsung, but now they think the actual technology to make it work isn't even worth $10 per device. If Qualcomm were making the same profit margins (relative to R&D) as Apple, they'd have to go from $10 per device to $100.
I'm not a Qualcomm fan (or any big corporation for that matter), but if we were making a list of price gouging companies, I think there are a lot of companies that should be getting fined and regulated (especially Apple) before Qualcomm.
The 2G patents (that Qualcomm owned 90% of) have expired.. but who uses that anymore?
Qualcomm also owns 13% of the patents used for LTE (which they agreed to license under FRAND terms).. it's those patents they are using to create a monopoly on LTE chips.
First they refuse to license their patents to other manufacturers who want to produce chips.. then they say to handset manufacturers, they won't sell you chips unless you agree to pay a royalty on every handset (even if it does not contain Qualcomm chips).
They own the same percentage of patents as Erickson, but they produce 4x the revenue from IP licensing (+ the revenue from chipset sales).
Edit: if you believe the 13% of LTE patents Qualcomm owns are worth $10... that would be $77 for all of the LTE standard essential patents at the same rate. So we are not far off from your $100 Apple-like price in your post.
Isn't that a FRAND violation?
But Ericsson and Nokia do charges a lot for their Mobile Carrier Infrastructure and Equipment, where as Qualcomm dont have part in that industry. And one reason why Huawei is winning because Huawei has been offering similar equipment for much cheaper price.
First, Qualcomm chipset also comes with IPs owned by Samsung and a slew of other wireless patent holders who crossed-licensed theirs with Qualcomm. Samsung and LG, along with Qualcomm, are the largest contributors of LTE SEP's and make up the bulk of LTE patents (KFTC likewise found that Qualcomm used its monopolistic position to force them to cross-license their patents for almost nothing in return). So no. Even if you stack everything, it won't be anywhere close to your nonsensical $77.
Second, under ETSI (see section 1.11), Qualcomm has the right to refuse the granting of licenses.
Is this why there's no option for an LTE modem in a MacBook Pro?
Apple would never (for some value of never) ship a laptop with an external device like that. The LTE is either baked into the laptop (at which point Qualcomm would demand a % of the entire laptop's sale price), or it's not included at all. They choose not at all.
I assume the difference between those two would be the difference between price?
Qualcomm's patented features do drive market demand (or add value) for mobile devices, including that of Apple's. That's why Qualcomm can ask a percentage of the entire device.
This is not so with MacBook Pro -- unless Qualcomm can prove it otherwise.
Higher tips per person are totally expected in fine dining place purely from economic perspective.
FWIW, I don't really have a dog in this race (except as an AAPL stockholder I want the stock to do well). If any judgement mandates that the license fee be charged on the cost of the chip and not the device, then I'd like to see that be extended to the App Store ToS as well.
If I go to that same Denny's and order 4 Grand Slams, the waitress waits on the cooks, and then makes one trip to my table. They get a much higher tip for less work.
In the App Store Apple offered a deal and sticks to it. You may not need like it but they’re doing exactly what they agreed to.
That’s not a conspiracy.
That’s why contract law exists.
Apple is also known to influence and buy politicians to win favors -- see Obama's reversal of Samsung ITC in 2013. In America, this is called "lobbying" and is perfectly legit. It's also rumored that USFTC's lawsuit against Qualcomm was Obama's parting gift to Apple. It looked like Qualcomm's allies (aka, lobbyists) urged Trump to terminate FTC's complaint against Qualcom, but I guess we will have to see how far this administration will allow this to go on.
There were none. It was REALLY easy to check that. There was a video anyone can watch.
If they misuse it why jot either quote it (to make it clear it’s kind of dubious) or use a correct term?
Apple in 2001 was posting losses and were an acquisition target. By 2007 they were just stabilising the company on the back of iPod but posting relatively small profits. It was the iPhone that propelled the company into being a huge, successful company we have today.
So why are they suing now ? Because they can afford to. They simply aren't the tiny, vulnerable company they were back in 2007 which Qualcomm could have crushed. And the world has changed such that phones are far more than just phones.
You aren't paying for their effort in hosting the app. It's a fixed cost and the App Store runs largely on the back of the iTunes Store platform. You are paying Apple for being a distribution channel i.e. channel to market. And it's incredibly common for those to be based on a percentage rather than fixed amount.
Apple does spends a significant amount of money (far more than your 30%) on giving developers the perfect market to sell to. Every customer has a credit card, is on the latest OS, is willing to spend, is unable to pirate etc.
Off topic here, but I find it interesting that Apple cracks down on various other workarounds like in app "tipping", but doesn't touch ads.
Would be interesting to see what the effective % apple tax is, if all ad revenue was factored in to the gross.
This is a tactic Intel itself is also very familiar with, as they've done with their CPU and GPU bundles. I believe in some cases it was even more expensive to buy the CPU alone, so OEMs were coerced into putting an Intel GPU into any device they sold, whether it had another dedicated GPU or not.
I understand at some point it becomes more expensive (but maybe not that much more) to keep those separated, but at the end of the day I believe it was an anti-competitive tactic through which Intel used its CPU monopoly to gain a much larger portion of the GPU market than they would've gained were it not for such bundles and price coercion tactics (and probably a few threats thrown into the mix against the OEMs too, if they dared to use AMD chips).
I wish regulators would catch on to stuff like this early and nip them in the bud, rather than act 10 years later, when the damage is already done, the monopoly is already well established, and the companies are forced to pay a fine of like 5% of what they gained from achieving that monopoly through the anti-competitive tactics.
Apple simply has enough money they apparently have decided they don't have to follow any rules they don't want. How do they handle licensing their patents? The article made no mention.
Reminds me of Mr. Robot & how Evil Corp still profited from ignoring regulations (which got people killed).
Building modems is way harder than building SoCs (all the SoC challenges plus all the modem ones too). It's taken a decade of work on 5G to just begin preliminary sampling (How many SoC generations would that be?).
You also have to keep in mind that it's not just the modem in the phone. You have huge software stacks, protocol design and testing, and an entire cell tower worth of electronics to design and build.
There's no free lunch. You have to strike a balance between forcing the cost onto the service provider (higher cell bills and/or slower adoption) and forcing the cost onto the phone.
Considering that Qualcomm's net sales to R&D ratio is basically unmatched (most companies spend half what Qualcomm does by that metric), it's not easy to make the case for gouging in my view.
The root of the problem is bad patent law. It really doesn't matter what apple does, it doesn't matter if their CEO eats babies, the merits of a patent are irrelevant to whether the company "feels like a baddy."
If you think apple has bad monopolistic practices in its app store, that only reinforces the fact that our system is anticompetitive, and that both Qualcomm should lose its patent as well as potential opening up of the IOS ecosystem.
Neither of these companies deserves our sympathy. They are two big amoral profit-seeking entities wrestling for money in a way that won't meaningfully affect your life. Whether Apple wins or Qualcomm wins or they split the difference, it's neither justice nor injustice.
I could buy all the raw materials that go into an iPhone, but that doesn't mean that I personally could make an iPhone. I'm glad to pay a premium because I don't have time to build a phone.
This isn’t a new idea, and people put tens of billions of dollars behind this concept every fiscal quarter.
yes and Apple loves that and that's why it makes its phones notoriously hard to repair or upgrade. that's why there are no SD card slots. that's why you have to buy an overpriced Apple exclusive lightning earphones or connector or whatever.
everyone is acting like the price of the phone must go up so much if it has higher storage, like there is no other engineering option.
If people were buying tens of billions of dollars worth of your product every three months, what would you do? Make it worse? Not find ways to make it more profitable?
I think you're incorrect about why Apple devices are not easy to repair and upgrade. But we may have to agree to disagree or have a different conversation about that.
Because we all know AAPL takes its proportional percentage of flesh from an app developer for having the audacity to add value to iOS, whilst simultaneously holding back the web.
Hypocrisy all around.
Qualcomm agreed to FRAND terms in exchange to adding their patents to the 3G standard.
Once that happened, Qualcomm then violated their FRAND terms to create a monopoly on CDMA chipsets, charge additional royalties, etc.
If they drop Qualcomm, then they'll have to drop CDMA support (Verizon, Sprint, 3g, 4g).
Maybe they should do some long term investments in this realm if it is where they choose to make their profits from?
Or pound sand in court..
While Qualcomm is the largest contributor of wireless standards, it is far from a monopology.
Also note that Apple accuses of every wireless patents holders of some sort of unfair pricing and violation of FRAND terms whenever Apple is up for license renewal. This is coming from a company that audaciously asked about $30 per device for a handful of frivolous design and utility patents from Samsung.
First, Apple doesn't directly pay Qualcomm. Apple has refused to take Qualcomm license, though I'm pretty sure Qualcomm would love to have Apple as their customer and start collecting license fees based on their retail price.
Second, Foxconn, Pegatron and Apple's contractors are the ones paying for Qualcomm licenses. Their licensing agreement with Qualcomm likewise precedes Apple's iPhone release in 2007. In another word, those contract manufacturers pay the same royalty rate to Qualcomm whether their end-products are for Apple, HTC, or whoever -- they all pay the same rate. Apple's rates are probably lower given various "collation" agreements (and rebates) Apple imposed on Qualcomm.
If you are trying to say Qualcomm unfairly charges Apple more, you need to bring some facts.
Those agreement also precede LTE.
You cant NOT use Qualcomm patents in LTE, but if Qualcomm were allowed to charge whatever they wanted, then they have a monopoly case, and we have to have somebody to define what is a fair price. Since Qualcomm are subject to FRAND.
All these patents fee were one of the reason why HEVC started charging $100M / year combined for their Video Codec, 20 times more the AVC / H.264. Because they saw what 4G patents were capable of charging.
1) can you cite your source? Apple is known for their sleazy wordsmithing and, having followed their lawsuits last several years, throwing completely unsubstantiated accusation at their opponent (see my comment about a 2012 USITC case against Samsung where Apple's own witness came out testifying against Apple). I'd like to read it myself as I'm pretty sure there are a lot of footnotes and modifiers that are not conveyed in one-liners.
2) whether contract manufacturers' licensing with Qualcomm precede LTE is immaterial in this case. Any LTE handset maker sourcing those contract manufacturers will (indirectly) pay the same rates. Apple and Qualcomm had business "collaboration" agreements in which Qualcomm provided additional technical, support resources and monetary compensation for sticking with Qualcomm (see Qualcomm's lawsuit). Apple is likely paying far less than smaller handset makers without such agreements with Qualcomm.
3) "You cant NOT use Qualcomm patents in LTE" <-- not sure what you mean. Qualcomm like many wireless patent holders routinely publishes their (initial) FRAND rates and if the company is engaged in unfair licensing practices, it would be easy to find that out. I'd like to emphasize that, contrary to Apple's view on FRAND, FRAND doesn't mean cheap and SEP patent holders are under no obligation to license their patents. (ETSI IPR Guide, Section 1.11 (http://www.etsi.org/images/files/IPR/etsi-guide-on-ipr.pdf):
The purpose of the ETSI IPR Policy is to facilitate the
standards making process within ETSI. In complying with the
Policy the Technical Bodies should not become involved in
legal discussion on IPR matters. The main characteristics
of the Policy can be simplified as follows:
• Members are fully entitled to hold and benefit from any
IPRs which they may own, including the right
to refuse the granting of licenses.
The difference is that Qualcomm agreed to FRAND (fair, reasonable, and non-discriminatory) licensing terms in exchange for their patent being included in the standard.
Once they got their patent in the standard, now they're saying they get to charge whatever they want.
That's the problem. That wasn't the deal they and everyone else agreed to, and it's too late to remove their patent from the standard.
Contrary to your unsubstantiated claims, Qualcomm's licensing rates are publicly available and published time to time -- often in the range of 3% to 5%. Apple according to this article pays nowhere close to the published rate that most other handset makers are paying.
So in mobile devices, Qualcomm's wireless patents do deservingly get per device royalty whereas, for automobiles, it would make no sense to use the same per device royalty.
On a somewhat unrelated note, Apple demanded the entire profit on per device basis for a couple of frivolous design infringement from Samsung and won a couple of years ago. This absurd, biased lower court ruling was overturned by the Supreme Court last year.
Is it the sofa from your house [1] or the powertrain that powers your luxury automobile?
[1] https://www.imore.com/tim-apples-ceo-companys-2017-q1-earnin...
Better hope you never see the source of a MediaTek Android kernel code dump. Someone with more malicious intent than me could instantly compromise a boatload of devices.
Are they actually making GPL source availible for their kernels?
Go search on Github for leaked sources, I am not sure if they're legal to post here...
It would be good if they just split the IP and Chip parts.
http://investor.qualcomm.com/secfiling.cfm?filingID=1234452-...
Now that is truly an innovation from Qualcomm, a switch that turns off the cell modem.
And no, "most companies" do not have gross margins of 70%.
As much as I or anyone hate patent trolls, one can't sit here and complain that a percentage of the value isn't a fair price to pay if one thinks it's okay for Apple to charge Music + App devs 30% to improve their OS + provide content for it's users.
But that’s not what they’re charging Apple. They broke an agreement.
What Apple is doing doesn’t violate an agreement, whatever you think of it.
Apple pays according to the article about $10 per device, or 1.33% of the retail price. This is far below what Qualcomm is charging, 3% to 5%, and what most handset makers pay. Further the royalty Apple pays (indirectly) is based on Apple's manufacturer's build cost, not retail cost.
What if they sold their chip for $10 and sold licenses to the necessary patents for $100/unit?
That’s not fair or reasonable. It’s one kind of situation FRAND was designed to prevent.
App developers can also handle the multiple country's tax laws, create a payment system and do all of that on their own as well. Apple devs don't have to deal with collecting taxes in the countries in which they sell. They don't have to deal with fraudulent transactions, chargebacks or distributing updates to users.
The idea that the 30% is somehow unfair is ridiculous. Look at retail markup rates for products sold in conventional stores. That's what that 30% is -- a retail markup and it's completely fair. Whole Foods sells olive oil for $20 that they buy from a supplier for $8. How unfair does 30% seem now? The supplier prices their product at the price they need to collect. What the end-distributer charges really isn't a concern to the supplier. But unlike Whole Foods, Apple doesn't give preference to certain suppliers over others. Everyone on the App Store has an equal chance to sell their product.
Apple's answer should be to open their own EE labs and start inventing things and getting their own patents. Instead, they complain and go to court.
Of course, that assumes the patents are good ones.
Apple's assertion is that the pricing is not Fair or Reasonable, which Qualcomm agreed to as a concession to make their patents part of the cellular network standards.
> Apple's answer should be to open their own EE labs and start inventing things and getting their own patents. Instead, they complain and go to court.
Apple cannot simply invent their own cell technology and have it work with the cellular networks that actually exist.
And no, under FRAND, Qualcomm can refuse license.
There really isn't a clear definition for "fair" or "reasonable", which is why this ends up in court.
> And no, under FRAND, Qualcomm can refuse license.
No. That's the "non-discriminatory" part. This one is actually pretty clear.
The purpose of the ETSI IPR Policy is to facilitate the
standards making process within ETSI. In complying with the
Policy the Technical Bodies should not become involved in
legal discussion on IPR matters. The main characteristics
of the Policy can be simplified as follows:
• Members are fully entitled to hold and benefit from any
IPRs which they may own, including the right
to refuse the granting of licenses.
USITC 337-TA-794 (Samsung) http://www.essentialpatentblog.com/wp-content/uploads/sites/...
Apple alleged that Samsung violated FRAND terms in the following ways:
1)
Apple argues that Samsung was obligated to make an initial
offer to Apple of a specific fair and reasonable royalty
rate." (p.60)
The evidence on record does not suppmt Apple's position.
Apple's witness on ETSI policy and practice testified the
ETSI IPR Policy document has "no precise definition ofFRAND" and that
it is expected that parties arrive at a FRAND license through
negotiation." (p. 60)
2)
Apple also criticizes Samsung's attempt to negotiate a cross-license of
both parties' mobile telephone patent portfolios."
We cannot say that Sam sung's offers in this regard are unreasonable.
The record contains evidence of more than 30 Samsung licenses that
cover the '348 and '644 patents. See RX-173C, RX-178C, RX-188, RX-189C,
RX-191C, RX-193C to -209C, RX-421C, RX-423C. All of those licenses
include a cross-license to the licensee's portfolio. That evidence
supports a conclusion t~at a portfolio cross-license offer is typical
in the industry and reasonable. ...
Apple has offered no evidence to suggest that such portfolio cross-
licenses are atypical in the industry. 19 In fact, Apple's own witness
on ETSI policies affirmed that ETSI anticipates cross-licensing may be
part of the process of negotiating a FRAND license between two parties.
3)
Apple also complains that Samsung's offer is unreasonable because [some
redacted terms Apple claimed was unreasonable]
Apple's argument lacks merit for several reasons. First, as has been
articulated in comments to the Commission from Qualcomm, Ericsson, and
Samsung, a FRAND license could encompass a range of reasonable terms. A
reasonable cross-license with one competitor may involve a
balancing payment to Samsung while a reasonable cross-license with
another competitor may involve Samsung making a balancing payment. Both
types of agreements may be reasonable, depending on the two portfolios
at issue and each party's respective volume of sales. F"
I could go on and on and point out Apple's willful ignorance on FRAND. And, yes, Apple's appeal to ignorance or your ridiculous claim that "There really isn't a clear definition for "fair" or "reasonable"," is not much of a sensical arguement.
That’s not a definition of FRAND, legal or otherwise. This is a statement of the ESTIs view on IP rights. The only reference to FRAND in that section is at the end, where it talks about non-FRAND IP.
> Conclusion: Apple's own witness testified that Samsung is under no obligation to make a FRAND "initial offer." Apple and their own expert clearly knew about it.
You literally just quoted an expert witness who says that there’s no definition of FRAND in that doc: Apple's witness on ETSI policy and practice testified the ETSI IPR Policy document has "no precise definition of FRAND"
You’ve provided no evidence for your claims about FRAND and I’m very uninterested in discussing whether Apple is playing dumb, because I really don’t care.
I assert Apple's markup on products is not fair or reasonable. Perhaps Qualcomm's demands are in line with the true value of the device and not the pie in the sky numbers Apple wants.
You can’t just arbitrarily apply it to something that’s not under a contract (Apple’s device prices) and say that because you don’t like that due to a non-legal system definition of FRAND Qualcomm is off the hook.
You don't get to agree to parts of it just because the company you are licensing to has more money to spend.
Qualcomm sounds a lot more fair and reasonable than any of the other multi-billion dollar companies I know of.
http://appleinsider.com/articles/15/10/28/apple-rd-spending-...
If I own a company with 100K revenue and spend 5K on R&D that doesn't make me more innovative, relevant or noteworthy than Apple.
It's all about the amount and quality of R&D that is important.
Qualcomm spends an average of 1.325B per quarter, and peaked in 2014 with 1.429B.[0]
Apple spends an average of 1.959B per quarter, but that has been steadily rising to 2.937B last quarter.[1]
[0] https://ycharts.com/companies/QCOM/r_and_d_expense [1] https://ycharts.com/companies/AAPL/r_and_d_expense
Apple is late to the wireless game and now they are trying to find a way to pay as little as possible while not contributing virtually nothing to it and being one of the largest benefactors of the tech.