Apple has wanted to use its own modems in its iPhones for some time. One way for Apple to achieve this is by acquiring an existing business. The company is apparently in advanced talks to buy Intel’s modem business. This acquisition would give Apple’s modem plans a serious head start.
The deal is apparently going to cost Apple around $1 billion and it could possibly be finalized within the next week. The news comes from a report from the Wall Street Journal.
Strategic Move for Apple’s Future
This new deal would give Apple access to ‘years of development work’ that Intel has done on modems and would allow Apple to develop its own modems, specifically 5G modems. The acquisition would not only save Apple significant time in research and development but also provide them with a wealth of intellectual property and technical expertise. This is crucial as the industry moves towards 5G technology, which promises faster speeds and more reliable internet connections.
Apple has been looking to get away from Qualcomm, who currently supply the modems for Apple’s smartphones. This would be a long-term strategy for Apple, as the two companies recently signed a deal that put an end to their licensing dispute. The settlement cost Apple a hefty $4.5 billion, highlighting the financial strain and strategic limitations of relying on Qualcomm.
Implications for the Tech Industry
If the deal between Apple and Intel goes through, it could have significant implications for the tech industry. For one, it would mark a major shift in the competitive landscape of smartphone components. Qualcomm has long been a dominant player in the modem market, and Apple’s entry could disrupt this status quo. Additionally, owning its own modem technology would allow Apple to further integrate its hardware and software, potentially leading to better performance and more innovative features in future iPhones.
Moreover, this move could inspire other tech giants to consider similar acquisitions to gain control over critical components of their products. For instance, Google has already made strides in this direction by designing its own chips for its Pixel smartphones.
The acquisition would also likely lead to job shifts and possibly layoffs within Intel, as Apple would integrate the acquired team into its own operations. However, it could also mean new job opportunities within Apple as they expand their modem development efforts.
Whether the deal between Apple and Intel will go ahead remains to be seen. The tech world is watching closely, as this could be one of the most significant acquisitions in recent years. I guess we will find out within the next few weeks.
Source: 9 to 5 Mac
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