Apple Buys Intel’s Smartphone Modem Division For $1 Billion

Apple is Paying Intel $1 Billion ( Roughly 7000 Cr) for the Chipmaker’s Modem Business, in a deal driven by the upcoming transition to the next generation of wireless technology. The agreement announced Thursday comes three months after Apple ended a long-running dispute with one of Intel’s rivals, Qualcomm. After this deal, Apple is ready to deliver the best 5G speeds and an Ultrafast experience for its Future iPhones.

Apple’s acquisitions have mostly been much smaller companies, making the Intel deal its second-largest ever after its $3.2 billion purchase of Beats Electronics in 2014. The Apple-Qualcomm truce prompted Intel to abandon its attempts to make chips for 5G modems, effectively putting that part of its business up for grabs.

Once the deal is complete, Around 2,200 employes, currently working in Intel, will join Apple, and around 17,000 Wireless Technology Patents will be transferred to Apple. The deal is expected to close down later this year.

Apple’s purchase of Intel’s smartphone modem patents and other technologies could help Apple to build its own 5G chips for its future iPhones. This will lessen Apple’s dependence on Qualcomm for 5G chips.

Currently, Qualcomm is the key supplier of 5G modems, particularly in the US. That’s because President Donald Trump’s administration has blacklisted another key 5G supplier, Huawei, as part of its trade war with China.

So Far, 5G connections are only available in few cities in the US, but they are expected to be available in more cities in the upcoming months. The faster speeds will enable users with 5G devices, to download movies within seconds or stream online content at really high speeds.

Sadly, this year’s iPhone lineup will not get any 5G variant, but Apple is expected to release its first 5G iPhone in September 2020. This will put Apple behind form its competitors like Samsung and Huawei which already launched their 5G devices.

“This is a clear ‘doubling down’ on 5G which remains at the centerpiece of the company’s smartphone future,” Wedbush Securities analyst Dan Ives said of Apple’s deal with Intel.

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