Apple Buys Intel Modem Unit for $1 Billion to Accelerate In-House 5G Development
Apple acquires Intel's cellular modem business for $1 billion, gaining 2,200 employees and 17,000 patents to fast-track its own modem production.
Apple acquires Intel's struggling cellular modem unit for $1 billion, bringing 2,200 employees and 17,000 wireless patents into its portfolio. Intel decides to sell the division because supporting just one customer costs the chipmaker too much money. This strategic purchase provides Apple with the essential engineering talent and intellectual property needed to develop its own mobile internet components.
While Apple currently relies on Qualcomm 5G modems for upcoming iPhones after settling a previous lawsuit, the company ultimately plans to eliminate all third-party partners. Intel missed key deadlines and delivered inferior performance, which forced Apple's temporary return to Qualcomm. The newly acquired Intel assets and ongoing hiring efforts in San Diego help Apple expedite its long-term goal of building modems completely in-house.
Developing proprietary modems fits perfectly into Apple's established playbook of designing critical components internally. The company already creates the main processors for its mobile devices and builds its own graphics engines and wireless chips. By bringing modem production under its own roof, Apple ensures full control over a vital part of its product ecosystem.