Friday, September 10, 2010, 10:20 pm PT (01:20 am ET)
Apple may abandon Intel's Infineon chips in next iPhone - reportThe next iPhone may forgo an Infineon baseband chip in favor of one from Qualcomm, according to an unconfirmed report.
The Commercial Times reported (Google translation) earlier this week that Infineon will not provide the baseband chip for the fifth-generation iPhone. Infineon's wireless unit was sold to Intel for $1.4 billion in August.
According to the report, the next-generation Apple smartphone, which is expected next year, will still be manufactured by the Hon Hai Group and Foxconn, and will include a Qualcomm baseband chip this time around.
A move away from Infineon would break with precedent. Infineon has supplied Apple with the baseband chip for the iPad 3G and all of the Cupertino, Calif., company's iPhone models since the smartphone was first released in 2007.
There has been little indication of trouble in the relationship between Infineon and Apple. After the Intel-Infineon deal, Intel CEO Paul Otellini told Fox Business that Apple CEO Steve Jobs was "very happy" with it.
On the other hand, relations between Apple and Intel have been tense as of late. Otellini made comments earlier this week criticizing the newly released Apple TV as a "step backward," especially when compared to the Intel-powered Google TV products set to be released this month.
A Qualcomm broadband chip would match rumors that Apple is developing a CDMA iPhone. Qualcomm invented the now widely-used CDMA technology. A cryptic "iPhone developer guru" job posting on the Qualcomm website in August claimed that respondents would work on "the most challenging product" of their lives.
Several analysts see a switch to Qualcomm by Apple as the right move. In light of the Intel-Infineon deal, "Apple may want to diversify its supplier base to reduce dependency on a single supplier," said Manikandan Raman with the Motley Fool.
With a dominant 69 percent share of the CDMA mobile phone chipset market, Qualcomm would be the "logical choice" to help Apple expand to other networks, said Barclays Capital analyst Andrew Gardiner. "Infineon's wireless unit doesn't offer chips for CDMA technology."
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