Apple has announced its plans to acquire the majority of Intel’s smartphone modem business for $1 billion. The takeover will see over 2,200 employees join the Apple business as well as Apple acquiring all IP and equipment.
The takeover will not affect Intel’s PC component business but rather the smartphone CPUs and 5G modems. Up to now, Apple has had to rely on Qualcomm so this takeover would mean the company could produce chipsets without any involvement from Qualcomm.
The company has accused Qualcomm of charging high patent fees and royalties charges for past chipsets but agreed on a six-year patent partnership in April 2019. Apple is expected to be producing its own in-house chips thanks to this new buyout in the next three years.
According to reports, the iPhone maker has already begun working on its own modems for a while now but has been planning this Intel buyout for some time in order to ramp up development and production of these chips.
Previously, Apple has been said to test both Intel and Qualcomm chipsets in its iPhones. The iPhone X reportedly had both chips tested in which Intel’s mobile chipset lagged behind Qualcomm. The iPhone XS, however, uses Intel’s chipsets due to Qualcomm refusing to sell hardware to aid iPhone production. We are not sure yet where the upcoming iPhone 11 will sit.
This was due to Apple and Qualcomm’s legal disputes which ended earlier this year and resulted in the 6-year agreement. The company will no doubt kick them to the curb the moment they have developed their own Intel modems now that the company has ownership.
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