Apple Reportedly in Talks to Acquire Intel’s German Modem Unit

Apple may have put aside its differences with Qualcomm and signed a multi-year licensing agreement with the company, but silently, it continues to work on its own modem. A report from The Information claims that Apple is in talks to acquire Intel’s modem unit in Germany to boost efforts of designing its in-house modem.

Intel had acquired Germany-based Infineon in 2011 for $1.4 billion. It is the same unit that has played a key role in designing and developing all Intel modems so far and this is the business that Apple wants to acquire. This is not the first time that we are hearing reports of Apple showing interest in acquiring Intel’s modem business. A WSJ report had also claimed something similar back in April this year.

Apart from the pool of engineers and tech, the acquisition will also give Apple access to the pool of patents that Intel has access to.

Any deal between Apple and Intel would likely include Intel patents and products, said one person briefed on the discussions. Such an arrangement would resemble the deal Apple reached with Dialog Semiconductor, a U.K.-based company that designs chips that handle power management chores in devices. Last year, Apple and Dialog struck a $600 million deal that brought 300 Dialog employees to Apple, along with some patents.

Before Qualcomm and Apple made up, the latter relied on modem from Intel for iPhones. Apple partially made the switch with the iPhone 7 before ditching Qualcomm modems completely for its 2018 iPhone lineup and switching exclusively to Intel modem. However, Intel modem offered inferior performance to that of Qualcomm.

More worryingly for Apple, Intel engineers were not able to stick to their promised development timeline of 5G modem which put Apple at the risk of not being able to launch a 5G iPhone in 2020. Along with a bunch of other factors, Apple eventually ended up solving all its disputes with Qualcomm outside of court in a settlement which saw it pay upwards of $6+ billion dollars to the chip maker. The move led Intel to completely exit the modem business as the company failed to see a “clear path to profitability and positive returns.”

Apple already poached Intel’s lead 5G engineer in February this year so it won’t be surprising if the company goes ahead and acquires the latter’s entire modem business.

Despite Apple making up with Qualcomm, the company wants to reduce its reliance on the San Diego chipmaker. For this, it is working on its own modem, though it is still a few years away from launch.

[Via The Information]

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