Apple acquires Intel’s mobile modem business for a billion dollars

The company will transfer more than 2 thousand employees, patents and equipment from Intel.

Apple will buy most of Intel’s mobile modem business for a billion dollars. At the same time, Intel will be able to continue creating modems for any devices other than smartphones.

The Apple will go 2.2 thousand employees, as well as intellectual property and equipment. The deal is planned to close by the end of 2019 after approval by regulators and other legal formalities.

Apple will have at its disposal 17,000 patents for wireless technologies, from cellular communication protocols to modem architecture. Intel will be able to continue producing modems for PCs, self-managed devices, or smart homes.

As Intel CEO Bob Swan (Bob Swan) noted, the sale of part of the business will allow the company to focus on developing modems for 5G networks, retaining key patents. Apple’s vice president of hardware, Johny Srouji, explained that the acquisition would speed the development of future products, but did not specify which ones.

Thanks to the purchase of Intel’s modem business, Apple will be able to produce 5G modems for iPhones itself, rather than buying them under license from Qualcomm. According to Bloomberg, Apple will switch to its own modems for three years.

In January 2017, Apple sued Qualcomm for overpriced licensing of mobile modems. The conflict ended only in 2019: Apple agreed to pay Qualcomm a cash reward and continue cooperation for six years.

At the time of the proceedings, Qualcomm refused to ship Apple chips, so the iPhone XS was released with Intel modems. Some journalists and users noted that Intel chips lag behind Qualcomm in speed.

About the negotiations on the acquisition of modem business, Intel first became known in the summer of 2018, when Swan took office and began to get rid of unprofitable areas. Apple is not the first time buying companies to develop their own solutions: in 2018, she acquired Dialog, which supplies power management chips.

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