Apple Will Get Rid of its Dependence on Qualcomm and Intel

Joanna Estrada
February 9, 2019

According to some media reports, people familiar with the matter said that Apple has transferred its modem chip engineering business from the supply chain department to its internal hardware technology department. Apple used Qualcomm's modem chips, but has gradually switched to Intel chips since 2016 and abandoned Qualcomm chips in the iPhone released a year ago. The organizational move has not been previously reported.

Modem chips are a major part of the cost of Apple devices, worth $15 to $20 each and likely costing Apple $3 billion to $4 billion for the 200 million or so iPhones it makes a year, said Bernstein analyst Stacy Rasgon.

Before this move, Apple's modem work ultimately fell under Dan Riccio, who ran engineering for iPhones, iPads, and Macs.

However, Apple declined to comment on this.

The Cupertino, California-based company has posted job listings for modem engineers in San Diego, a hub for wireless design talent because of Qualcomm's longtime presence there and a place where Apple has said it plans to build up its workforce.

All of the modem chips used in Apple devices were supplied by Qualcomm not too long ago, but over the past few years, the company has transitioned to using only Intel modems.

Though Apple designs and commissions the manufacturing of the iPhone's high-performing A Series chipsets, plenty of other components inside of Apple's phones are bought from other companies. Apple's timeline for coming out with its own modem chip could put it behind the initial launch of 5G phones, though it's been widely expected that the 2019 iPhones would lack 5G connectivity. The fact that the team is moving into the group focused on developing in-house components is a strong signal that Apple will not be looking outside its own walls for modems in the future. Qualcomm provides this synergy for phones like the Samsung Galaxy S9, which uses both Qualcomm's Snapdragon processor and Snapdragon LTE modem.

Other reports by Click Lancashire

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