Apple In Advanced Talks To Buy Intel's Smartphone-Modem Chip Business (cnbc.com) 64
According to The Wall Street Journal, Apple is in advanced talks to buy Intel's smartphone-modem chip business (Warning: source paywalled; alternative source), "a move that would jump-start the iPhone maker's push to take control of developing the critical components powering its devices." From the report: A deal, covering a portfolio of patents and staff valued at $1 billion or more, could be reached in the next week, the people said -- assuming the talks don't fall apart. Though the purchase price is a rounding error for companies valued in the hundreds of billions of dollars, the transaction would be important strategically and financially. It would give Apple access to engineering work and talent behind Intel's yearslong push to develop modem chips for the crucial next generation of wireless technology known as 5G, potentially saving years of development work.
For Intel's part, a deal would allow the company to shed a business that had been weighing on its bottom line: The smartphone operation had been losing about $1 billion annually, a person familiar with its performance has said, and has generally failed to live up to expectations. Though it would exit the smartphone business, Intel plans to continue to work on 5G technology for other connected devices. Earlier this year, it was reported that Apple began discussing plans to acquire parts of Intel's smartphone modem chip business last summer, around the time former Intel Chief Executive Brian Krzanich resigned. "Mr. Krzanich championed the modem business and touted 5G technology as a big future revenue stream," reports The Wall Street Journal. "When Bob Swan was named to that job in January, analysts said the odds of a deal rose because his focus on cleaning up Intel would require addressing the losses in the modem business."
For Intel's part, a deal would allow the company to shed a business that had been weighing on its bottom line: The smartphone operation had been losing about $1 billion annually, a person familiar with its performance has said, and has generally failed to live up to expectations. Though it would exit the smartphone business, Intel plans to continue to work on 5G technology for other connected devices. Earlier this year, it was reported that Apple began discussing plans to acquire parts of Intel's smartphone modem chip business last summer, around the time former Intel Chief Executive Brian Krzanich resigned. "Mr. Krzanich championed the modem business and touted 5G technology as a big future revenue stream," reports The Wall Street Journal. "When Bob Swan was named to that job in January, analysts said the odds of a deal rose because his focus on cleaning up Intel would require addressing the losses in the modem business."
Maybe Apple could raise the quality (Score:2)
Seems like the Intel stuff was never as good as Qualcomm...
Apple may be thinking about this to get out from under Qualcomm's control. But would that really work given the vast array of patents Qualcomm has? Seems like Apple would still be at their mercy.
Still probably a better position to be in I guess controlling custom hardware and not having to wait for enhanced support from chip suppliers.
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Seems like the Intel stuff was never as good as Qualcomm...
No shit, collage graduate Ken Doll.
Apple may be thinking about this to get out from under Qualcomm's control. But would that really work given the vast array of patents Qualcomm has? Seems like Apple would still be at their mercy.
Yes. Yes they would. That's what they discovered after PAYING INTEL TO DEVELOP THEIR MODEM TECHNOLOGY IN THE FIRST PLACE.
You must remember this. Apple essentially stole Qualcomm IP and gave it to Intel to develop modem technology to avoid having to source it from Qualcomm. We know this because Qualcomm sued and Apple lost the initial round and then decided to settle rather than appeal.
Plus this is still pretty shitty on Apple's behalf, considering they essentially goaded I
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I didn't know Ken did collage art, he's so talented.
Might work... (Score:1)
I'm pretty sure it will backfire, Apple has no experience on this
I feel like they kind of do though, as they have had to work with a lot of different wireless technologies and some of that surely was custom designs from Apple.
now they are not builders or makers of hardware
components, they are designers for fancy end-consumer products
But they always have been, look at all the GPU work they do themselves as well as integrating a lot of other stuff into custom chips.
Still though Qualcomm has quite a lead I wou
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Are modems really that important though? The smartphone market is fairly saturated, and with 5G does anyone really care about the performance of the modem when the limiting factor will be contention and the slow web site?
Maybe 5 years ago would have made sense, but now all the action in the modem sphere is with IoT and driving down cost, not stuff Apple is really in to.
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Re:Maybe Apple could raise the quality (Score:5, Interesting)
First, Apple has been using the Intel chips even before Intel owned it. Intel acquired Infineon, who was one of the big makers of modem chips. The original iPhone used Infineon chips, which have excellent power management, though it has a habit of overloading control channels because of they way they achieve those power savings. It's the reason AT&T's network basically collapsed after the iPhone was released with dramatically increased numbers of call non-completions and call drops. Yet at the same time, AT&T scored the fastest data network - what happened was the control channel was overloaded so you can't make or hand off calls, but the data channels were free, leading to great speeds. And yes, both AT&T and Cingular at the time begged Apple to not use Infineon chips for that very reason. But the power savings were compelling.
So the chips are familiar to Apple - it's a continuation of a line of chips Apple continued to use, save for a brief period when Apple made an exclusivity deal with Qualcomm, having done so because Qualcomm was the only supplier of chips to support Verizon. Since Qualcomm sold dual mode chips, this let Apple use a single chipset.
Of course, during this time, Apple gets screwed by Qualcomm as they ramp up the royalties, so Apple basically is trying to not be dependent on one supplier.
As for the purchase, Qualcomm holds patents, but so would Apple. and they would be each forced to cross-license from each other. Qualcomm would need Infineon/Intel/Apple patents, and Apple would need Qualcomm patents. Expect to see a lot of pushback from this - other patent holders would hate to have Apple own some critical patents.
Intel good, Qualcomm better (Score:1)
Apple wants to have radio options, but the reality is Qualcomm has the better tech (and a lot of the patents) today. And everyone knows that. Including Apple and Qualcomm.
RF Physics is hard, and Scottie was essentially right: "Ye cannae change the laws of physics".
Is Apple about providing the best technology (which means buy/pay Qualcomm today), or do they only care about profit margin (quality be damned)? I think this potential purchase answers the question. And not in a good way (for customers of Appl
Re:Intel good, Qualcomm better (Score:5, Insightful)
or do they only care about profit margin (quality be damned)?
Or maybe somewhere in between. My company has done similar with suppliers.
Without this:
Q: We will charge $50/modem else you can't sell ANY 5G phones! (evil laugh)
A: shit. how about $49?
Q: No. now it's $60
With this:
Q: We will charge $50/modem else..
A: No. 20.
Q: Without us you won't have the best modems.
A: Only 0.1% customers notice. So we will survive this. You need our business too. So negotiate or goodbye
Q: Ok 30.
Outcome: spend $1b in order to save >1b in negotiations.
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In the past they just crippled Qualcomm modems to bring them down to Intel speed, so customers couldn't complain about getting the inferior modem.
How far do you take it though? Add a little heating resistor to waste some power so the Qualcomm phones battery life is as bad as the Intel ones?
More likely this is preparation to go single supplier using their own in-house parts, like they did with CPUs.
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>RF Physics is hard
Phone modems are no longer about physics, RF frontends are a solved problem (can buy one from third party), they are about software patents - implementing patented DSP algorithms. Intel has enough patents and licenses to enable manufacturing own hardware.
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That's not what happened here. If you read about the whole issue, particularly the FTC suit against Qualcomm, you'll see there's a lot more going on.
Qualcomm makes modems. Their tech is the best in the business. If you want the fastest data speeds for the phones you sell, you use Qualcomm chips. But there are 3 other aspects of this that when combined with Qualcomm's modem business makes all phone makers in a bad position.
1) Qualcomm also makes other chips; accelerometers, memory, etc. These products o
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It's also for a bunch of patents that Intel is holding and Qualcomm needs, which are usually cross-licensed. Apple buying it means Qualcomm is in a tough position because Apple will be in a much stronger negotiating position - if Qualco
Is Intel circling the drain? (Score:2)
Intel missed the mobile revolution. Totally. Playing catch-up was never their strength. Microsoft, being software-based, can re-emerge as a leader with one great app/platform/OS. But Intel cannot leapfrog the chip winners in mobile. Game over, man, game over. Mobile is gone for Intel.
Intel missed the low-power revolution, in the same way they missed the mobile revolution. ARM is eating everything. I'll probably buy an ARM-based laptop soon when they more than equal midrange desktop performance. Oh, wait, is
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I wonder if Intel will switch to chiplets as well.
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It makes way more sense design wise. I just wonder how long it will take them to be able to change over to that.
My current rig is an old X5460 on a modified 771 motherboard. All of these hotfixes for Spectre/Meltdown etc have noticeably lowered the FPS I get on this thing. I'm going to pay some debt off and see about getting a Ryzen 5 3600 system next year.
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https://www.youtube.com/watch?... [youtube.com]
Intel just can't compete right now.
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Intel can't get 7nm out the door on time, they are late to that party.
What Intel calls their 10nm process is effectively the same as everybody elses 7nm process. The only thing they are late with is marketing lies.
after giving it to Chinese mind you (Score:2)
Intel shared 5G modem IP with Unisoc, part of Tsinghua Unigroup holding. They also gave Atom IP to Chinese 5 years ago and showered vendors with money (losing couple Billions per year) to combat ARM Tablets.
https://www.scmp.com/tech/scie... [scmp.com]
https://www.anandtech.com/show... [anandtech.com]
http://linuxgizmos.com/intel-i... [linuxgizmos.com]
oh, and just by coincidence Unisoc launched their first "home grown" 5G modems http://www.unisoc.com/unisoc-l... [unisoc.com]
what's in it for Apple? (Score:2)
Making your own chips that are custom-tuned to suit your own operating system is a competitive advantage that pretty much nobody else in the world is going to beat. (Who else controls BOTH the hardware and the software for their phone?) That's already proven for CPU and GPU, and the next hurdle is the cellular/wifi chips (and then power).