The Wall Street Journal reports Apple is now in “advanced talks” to buy Intel’s smartphone modem chip business.
The report, sourced from the ever-popular “people familiar with Apple’s plans,” says the deal covers a portfolio of patents and staff that is valued at $1 billion or more. The deal could be set as soon as next week if the talks continue.
Talks between Apple and Intel are said to have been conducted off and on for around a year or so. The talks had ended right around the time Apple and Qualcomm settled their legal battle, reaching a new supply agreement.
That agreement spurred Intel to seek other buyers, but discussions with Apple resumed once more shortly after they ended.
The Apple-Intel talks are said to have started last summer, around the time that former Intel Chief Brian Krzanich resigned. While Krzanich was a champion of Intel’s modem business, and saw 5G technology as a huge revenue stream for the firm in the future, New leader Bob Swan’s focused on addressing the losses in Intel’s modem business.
Apple has reportedly been working on developing its own modem chips since 2018, but their technology isn’t ready for prime time.
Apple had been planning to use Intel 5G smartmodem chips in its 2020 iPhone lineup, but reports suggested Intel was missing deadlines, and the chips wouldn’t be ready for 2020. This is thought to have lead to Apple’s legal agreement and contract with Qualcomm.
Intel announced in April that it was leaving the 5G smartphone modem business, making the announcement soon after Apple and Qualcomm announced their settlement and new supply deal.
If Apple does buy Intel’s modem chip business, it would gain an advantage as it seeks to bring modem chip development in-house, making the company less reliant on the outside supplier, Qualcomm.