Apple acquiring the Intel’s 5G modem business.
So, the rumors were true – Apple will be acquiring the majority of Intel’s smartphone modem business for $1 billion. In Apple’s press release they announced that Apple and Intel had signed an agreement for this. Roughly around 2200 employees of Intel will join Apple along with the equipment, leases, and intellectual properties. Apple expects to close the transaction in the fourth quarter of 2019. However, earlier this week in The Wall Street Journal reports all but sure about the finalization of the deal.
After this, Apple will hold over 17,000 wireless technology patents, varying from protocols for cellular requirements to modem architecture and modem operation. Intel isn’t out of the modem business; it will still be able to design modems for PCs, internet devices, and self-driving cars. Intel CEO Bob Swan stated :
This agreement enables us to focus on developing technology for the 5G network while retaining critical intellectual property and modem technology that our team has created,” said Intel CEO Bob Swan. “We have long respected Apple and we’re confident they provide the right environment for this talented team and these important assets moving forward. We’re looking forward to putting our full effort into 5G where it most closely aligns with the needs of our global customer base, including network operators, telecommunications equipment manufacturers and cloud service providers.
And Apple’s senior VP of hardware technologies, Johny Srouji stated:
We’ve worked with Intel for many years and know this team shares Apple’s passion for designing technologies that deliver the world’s best experiences for our users. Apple is excited to have so many excellent engineers join our growing cellular technologies group, and know they’ll thrive in Apple’s creative and dynamic environment. They, together with our significant acquisition of innovative IP, will help expedite our development on future products and allow Apple to further differentiate moving forward.
Intel developed its wireless modem business by the acquisition of Infineon’s wireless business nearly a decade ago. The company intended to complete straight with market leader Qualcomm, which dominates the market in modems in smartphones and numerous other devices. Apple has traditionally utilized Qualcomm modems in the iPhone; however, it has recently suffered a litigious and disturbing relationship with Qualcomm.
Qualcomm sued Apple for patent infringement as Apple began shipping iPhones with Intel modems. The litigation was dropped when Intel stated that it would exit from the 5G smartphone modem business.
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Apple’s reliance on Qualcomm will also reduce by this acquisition. Thus, it reduced its dependence on third-party vendors and companies by its chips and other components. Now, it’s looking to create its course into the 5G era for its future iPhones.