Apple was searching for companies to partner with to bring 5G compatibility in the upcoming models of the iPhone. Moreover, Apple had entered into talks to buy Intel’s modem chip business, according to a report. After being in talks with 5G modem manufacturers like Intel and Qualcomm, Apple finally reached an agreement with San Diego based company, Qualcomm.
Both Apple and Qualcomm were in conflicts not so long ago and it lasted a few years. Surprisingly, the court battle was all ended just a few weeks ago. Before the negotiations began, Apple had plans to develop its own chipset for the next iPhone to be released. In a bid to speed up the process, Apple even hired Intel’s lead developer for 5G phone modems, Umashankar Thyagarajan, back in February. Though this act of “poaching” is no new thing, it brings some insight into the desire of Apple to develop its own chipset in the coming years.
Apple wants its 2021 iPhone models to be powered by its own developed chipsets despite the six-year licensing deal it has with Qualcomm as well as a supply chain agreement. Intel, on the other hand, has stopped plans to work on the 5G mobile modems business after Apple abandoned the 5G chip project.
According to internal emails, the departure of Thyagarajan caused a huge setback for Intel’s 5G ambitions. This has made Intel reshuffle the whole team but at the end of the day, it brought its 5G plans to an end. Messay Amerga and Abhay Joshi, executives at Intel, revealed in an internal email that Mr. Thyagarajan had “played a key role” in the Intel chip which powered the 2018 iPhones and he had been the project engineer on developing its 5G chip, known as XMM 8160.
Intel was selling off the whole of its 5G modem chip business to Apple or some other companies, but it all came to an end when a settlement was made with Apple. Patrick Moorhead of Moor Insights reveals Intel’s chip business is setting the company back about $1 billion annually, and its value keeps going down every second without a sale. Whereas companies like Broadcom, ON Semiconductor Inc., Samsung, or Chinese company Unisoc Communications Inc are some potentials buyers for Intel’s business.