Apple wants to acquire the "majority" of Intel's smart phone modem business for a billion dollars, the two companies announced today. About 2,200 Intel employees will join Apple, and Apple will also acquire Intel IP and equipment. The transaction is expected to end towards the end of the year.
Intel does not come completely out of the fashion industry. It will still be able to develop modems for PCs, Internet of Things devices, autonomous vehicles and apparently all that is not a smartphone. Intel CEO Bob Swan said the acquisition will allow the company to focus on developing other 5G technologies.
The acquisition means Apple is now well on its way to producing its own 5G modems for its smartphones, rather than relying on Qualcomm for the hardware. Apple recently resolved its lengthy dispute with the chip maker, and when it did, Intel did not lose time announcing it would leave the 5G phone industry as a direct result of the settlement. Analysts quoted by Bloomberg at that time suggested that Apple's internal modems could be ready in three years.
Apple's SVP of hardware technologies, Johny Srouji, said that the acquisition will "help accelerate our development of future products and allow Apple to further distinguish ahead."
The acquisition will also reduce Apple's dependence on Qualcomm, the dominant smartphone modem provider. Lately, Apple has accused Qualcomm of having charged "disproportionately high" patent fees, which it was accused of forcing companies to agree to access the hardware as part of a "no license – no chips" Policy The total. Apple and Qualcomm achieved a six-year patent license agreement in April, which Apple will probably rely on when developing their own modems.
As a result of legal dispute, Apple Intel's modems rely solely on their iPhone XS. Apple claimed they were trying to use Qualcomm's modems, but the company refused to sell them to Apple.
Reality's reality suggests that Intel's modem technology has historically hung on Qualcomms. When Apple used modems from both companies in the iPhone X, a report claimed that Qualcomm's hardware was at a higher rate than Intel, despite the fact that some features of Qualcomm's modem were disabled.
Apple has reportedly been developing its own modems for a while. Last December, job advertisements appeared, suggesting that the company was working on its own network hardware from the offices of Santa Clara and San Diego. The latter city houses the Qualcomm global headquarters, and Apple recently announced plans to employ 1,200 more employees in the city.
The talks with Intel about acquiring their modem business are understood to have started last summer, according to The Wall Street Journal when Swan arrived focusing on tidying up the company and recording the losing business segments.
Acquiring another business to develop your own competitor is a tactic Apple has spent at least once before spending $ 300 million on part of Dialog, a company that has previously supplied Apple power management chips to their phones . The acquisition date, which included 300 employees, was Apple's largest ever in terms of the number of employees.