Apple could soon become the new owner of Intel's huge trove of modem-related patents, according to a new report on the two-page negotiation.
Intel decided to get out of the 5G modem game earlier this year after Apple signed an agreement to use Qualcomm's modems for the next couple of years. It appears that Intel's losses can be a big gain for Apple's own efforts to become less dependent on third-party iPhone chips.
Wall Street Journal reports that Apple is in advanced negotiations to buy Intel's smartphone modem business. An agreement can probably be reached as soon as next week, which will give Apple a portfolio of patents worth around $ 1 billion.
Apple and Intel have been in conversation and on for about a year now. Procurement calls cooled down when Apple announced the deal with Qualcomm, but then resumed shortly afterwards.
Intel's modem division has been operating with losses for many years. Former CEO Brian Krzanich pushed the company to create 5G modems to create a new large revenue stream, but the company has not had as much success as it has had with computer CPUs. When Bob Swan was appointed CEO earlier this year, it became more important for Intel to sell the modem business to renew the focus on what Intel does best.
iPhone has been using Intel modems since the launch of the iPhone 7. There was some controversy with that chip, though it turned out to be slower than the Qualcomm modems that were also used for the iPhone 7. Intel has visited other buyers for its modem patents, but Apple seems to be the most interested.
Apple is investing heavily in its own 5G modem business in recent years. The company has a hub in San Diego where it plans to employ at least 1200 people. An Apple layer 5G modem is not expected to be ready for a few more years, but Intel patents can give the project a serious boost.