Apple Inc took a major step toward supplying its own smartphone chips by purchasing the majority of Intel Corp's modem business in a deal valued ...
REUTERS: Apple Inc took a major step toward supplying its own smartphone chips by purchasing the majority of Intel Corp's modem business in a deal valued at US$1 billion, the companies said on Thursday.
Modem chips connect devices like the iPhone to wireless data networks, but Apple has always relied on outside suppliers for the part. Intel positioned itself as the sole source of iPhone modem chips over the past year after Apple got into a prolonged legal fight with previous supplier Qualcomm Inc over Qualcomm patent licensing practices.
Technology news publication The Information last year reported Apple's efforts to develop its own modem, but the iPhone maker has never formally acknowledged it. In February, Reuters reported that Apple moved its modem engineering efforts into the same chip design unit that makes the custom processors for its devices, signaling a doubling down on the pursuit of self-designed modem chip.
But any replacement of Qualcomm is likely to happen in phases, this person said, as Apple builds up its ability to ensure that its modems work on all the networks and countries where Apple sells phones. Ensuring worldwide compatibility is Qualcomm's historical strength, and Apple might still have to rely on Qualcomm for some modems during a transition period to its own devices.
Apple has engaged with Taiwan's Global Unichip Corp, a chip design house in which Apple supplier Taiwan Semiconductor Manufacturing Co is an investor, to explore a modem design, but the work is in early stages.
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