Apple’s reportedly trying to buy Intel’s modem unit – Here’s Why

Apple needs access to 5G technology, and right now, Apple doesn’t want to pay the high royalty fees that come with using Qualcomm’s technology. Qualcomm knows how valuable 5G is within the mobile computing market; and with this in mind, they are willing to let Apple and other company’s pay through the nose for early access. 

According to the Wall Street Journal, Apple is in talks with Intel to acquire its modem unit, alongside the IP and staff to make the unit function. Apple is reportedly prepared to pay $1 billion for the group, seeing 5G as an essential strategic technology for the company’s future mobile devices. 

Within Intel, the company’s modem group can be considered a failure. Right now, the group is losing the company money each quarter while failing to achieve high sales of its chips with major mobile phone makers. Intel hoped to sell its new 5G chips to Apple, but sadly the company could not provide them with the technology in time, forcing Apple to move back to Qualcomm. 

Apple wants to own all the essential technologies that the company requires to operate. This self-sufficiency prevents them from paying accessive royalties to 3rd parties while enabling them to focus the development of their technology on areas which they deem as critical. A recent example of this is Apple’s move to design its own GPUs with recent iPhone SoCs, moving away from Imagination Technologies to become more self-sufficient. 

5G tech will enable Apple to offer a compelling upgrade over its previous generation products, with the speed and bandwidth provided by 5G enabling faster internet connectivity and greater access to cloud services on the go. Today, Apple’s iPhone sales are comprised of a larger number of “legacy” devices than in prior years. Fewer people are buying Apple’s latest iPhones, showcasing the company’s need for the company to deliver a compelling upgrade option to consumers.