Roger Fingas
Intel will be Apple's exclusive cellular modem supplier for next-generation iPhones, the CFO of Qualcomm indicated on Wednesday.
"We believe Apple intends to solely use our competitor's modems rather than our modems in its next iPhone release," said George Davis in a conference call. Apple's only other modem supplier in recent years has been Intel, which came onboard in 2016, supplying components for GSM versions of the iPhone 7 and other recent iPhone models.
Losing Apple as a client, if even just temporarily, could deal a serious financial blow. The iPhone is of course one of the most popular smartphone brands in the world, often leading in key markets.
Multiple reports have hinted at Apple going Intel-only, thanks largely to the latter's XMM7560 chip, which supports both GSM and CDMA carrier networks. The modem is now in mass production for 2018 iPhones, though until now it was uncertain if some phones would still use Qualcomm parts.
Apple has strong incentive to ditch Qualcomm, as the two companies are engaged in a global legal battle over patents and royalties. Apple began the war in January 2017 with a $1 billion lawsuit, claiming Qualcomm abuses its "monopoly power" to demand high royalties and force chip buyers to license patents. The chipmaker countered in April, and the pair have since lodged multiple complaints in domestic and international courts, roping in other Apple suppliers as well.
Until 2016 Apple was locked into an exclusive arrangement, but prior to the XMM7560, the technical superiority of Qualcomm's modems was another factor keeping the company from switching to Intel. On top of broader network support, Qualcomm chips have been faster, to the point that Apple throttled them to prevent major gaps with Intel-based hardware.
This fall should see three new iPhone models: 5.8- and 6.5-inch OLED devices, and a 6.1-inch LCD unit. The LCD phone could potentially ship later than its counterparts.
Malcolm Owen
Amber Neely
Christine McKee
Chip Loder
Marko Zivkovic
25 Comments
They have nobody to blame but themselves. If they didn't charge such exorbitant licensing fees and didn't sue at the drop of a hat, Apple probably wouldn't be shying away from them.
Intel better take advantage of this gravy train while it lasts. Like with the CPU, the GPU, various controllers, Apple is all but guaranteed to use a custom Apple designed cellular modem sooner or later.
At least Intel can sell fab capacity. All QC gets are FRAND residuals.
It will be interesting to see the benchmarks of Intel vs. Qualcomm. Specs point to Qualcomm still having an advantage. However the average buyer doesn’t even know what these chips are, nor do they care, and if Apple saves on royalty and chip costs to make phones a little cheaper that’s what counts to gain market share. Unfortunately Intel is not an industry leader their specialty chips and CPUs are big and inefficient relative to the competition. Apple is likely buying time before they have their own solution for both radios and CPUs!