Apple now plans to buy Intel’s 5G mobile modem business for $1 billion. The deal could be announced as early as next week, as per The Wall Street Journal report says.
A few months ago, Apple reached a sudden settlement with Qualcomm that allowing Apple to return to using Qualcomm’s modems in its phones.
According to Bloomberg reports, Apple thought Intel couldn't deliver 5G modems for a 5G-ready iPhone soon enough, so Apple had to make friends with Qualcomm, and then Intel reportedly began searching for a buyer. As a result, Intel had abandoned the modem business directly because of the Apple settlement.
After this revelation, Intel shortly made an announcement in April that it planned to exit the 5G mobile modem business.
Intel CEO Bob Swan said,
In light of the announcement of Apple and Qualcomm, we assessed the prospects for us to make money while delivering this technology for smartphones and concluded at the time that we just didn’t see a path.
According to a report, Apple had reportedly decided Intel’s modems weren’t up to the task of providing 5G for the iPhone on time, leaving no other choice but for it to take the PR hit of ending its years-long dispute with Qualcomm for the sake of the iPhone’s future.
Intel isn’t shut the 5G modem business entirely. The company is still building networking and infrastructure products, as well as modems for devices, but not for smartphones.