2 Dropping Suppliers Just to Gobble Them Up

Earlier this year, Apple announced that it would no longer be using graphics tech or intellectual property developed and created by Imagination Technologies in its devices. Instead, the Cupertino tech giant told Imagination that it would be using its own proprietary graphics chips and homegrown systems moving forward.

As expected, the news crippled Imagination’s stock valuation. That turn of events led some people to claim that Apple was planning on dropping the supplier all along, just to swoop in and acquire the company on the cheap. On the surface, this theory might seem a clever yet devious move — but it doesn’t really make much sense under critical analysis.

As Ashraf Eassa of the Motley Fool points out, the price difference just wouldn’t be that significant to a company as large and as profitable as Apple. A likelier scenario is that the company just believes that it could make its own graphics tech better and more efficiently. And indeed, in recent years, Apple has made a larger effort to rely on proprietary technology.