Apple's Acquisition of Intel's Smartphone Modem Business Completed, Intel Admits 'Multi-Billion Dollar Loss'
Intel today announced it has completed the sale of the majority of its smartphone modem business to Apple for $1 billion following regulatory approval. The transaction was first announced in July and includes intellectual property, equipment, and approximately 2,200 Intel employees joining Apple.
The deal sees Apple acquire a large portfolio of wireless patents from Intel. Apple now holds over 17,000 wireless technology patents, ranging from protocols for cellular standards to modem architecture and modem operation.
Intel will retain the ability to develop modems for non-smartphone applications, such as PCs, internet-of-things devices, and autonomous vehicles.
Last week, Intel admitted that it sold its smartphone modem business to Apple at "a multi-billion dollar loss," according to court documents unearthed by Reuters. Intel added that rival chipmaker Qualcomm's patent licensing practices "strangled competition" and effectively forced it to exit the market.
Apple is expected to use Qualcomm modems for its first 5G-enabled iPhones next year, as part of a six-year licensing agreement between the companies. Farther down the road, multiple reports have claimed that Apple plans to develop its own modems for iPhones by 2022-23, and this Intel deal would certainly help those efforts.
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Top Rated Comments
The real question, though, is if it's really worth it for Apple to be in the modem business at all. That business relies on economies of scale and a lot of engineering and wireless expertise.
I'd guess the goal is to do what it did with Bluetooth and the W1, making the modem low-power. Radios are a big power draw, and I doubt Qualcomm or Intel were willing to make a power/performance tradeoff. At some point that could become yet another competitive advantage for Apple.
I mean, they could probably save a bunch of power just by optimizing the modem's software stack. Most of those modems are driven using the Hayes AT command set, which means you need some kind of serial emulator. Apple could rip out that interface layer and go direct to the modem, which would make it more efficient, which should lead to better power/performance.
If they did it for BT/WiFi they should be able to do it for LTE/5G/6G and beyond.
I also think Apple designed modems will be several years out