In April of this year, Apple and Qualcomm put an end to their long legal battle and closed a new collaboration agreement , which led Intel to announce that it was abandoning the 5G modem business for smartphones , since until then they had no other client and there was no point in moving forward, as explained by Bob Swan, CEO of Intel.
Later, during the same month of April, it was announced that Apple and Intel had been negotiating during 2018 the purchase-sale of the modem business , with which Apple would be in a position to develop and manufacture its own chips without the help of Qualcomm, with whom he had a legal battle at that time.
Today, according to new information from The Wall Street Journal , Apple is in “advanced negotiations” with Intel to acquire its modem business for smartphones for $ 1 billion.
Apple seeks greater independence
According to the information, the agreement could be announced as soon as the following week , and would include a patent portfolio, modem designs related to multiple generations of this wireless technology and personnel specialized in the development of these modems, which would happen to Apple hands immediately.
Remember that Apple and Qualcomm signed a new six-year collaboration agreement, with the option to be extended for two more years, so Apple will continue to have access to Qualcomm technology for its devices. However, while there was the legal battle between the two companies, information emerged that Apple had a ‘Plan B’ , which was to develop its own 5G modems so as not to depend on Qualcomm or Intel , a plan that was thought to have been dismissed after the agreement with Qualcomm.
Today, if the information turns out to be true, it would be confirmed that Apple is moving forward with that plan. In addition, by having Qualcomm technology available for up to eight years, it would give them a good margin to work on their own modems and thus not have to renegotiate with Qualcomm later.
On the other hand, Intel has been the most affected of this whole case, since it went from being the only Apple supplier to having nothing, so they decided to close that part of the business. However, Intel was still looking to sell this division to Apple , which, according to Patrick Moorhead, director of Moor Insights & Strategy, represents Intel more than $ 1 billion annually in losses.
Remember that Apple already develops and designs its own chips, CPU and GPU, for its mobile devices, but there are still components that depend on a third party, such as modems. With the purchase of this division from Intel, Apple would accelerate its independence process and allow it to have greater control in the creation of its devices in the future.