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Apple acquires Intel’s smartphone division for $1bn

According to an announcement issued by Apple and Intel yesterday, the former will buy a majority share in the latter’s phone modem business for $1bn. Apple will also take over equipment and IP from Intel. The deal should be finalised by the end of 2019.

Intel is not leaving the modem business completely. It will still be allowed to build modems for Internet of Things devices, PCs, self-driving cars, etc., but not phones. According to Intel’s CEO Bob Swan, the deal will enable Intel to concentrate on other 5G technologies.

The acquisition means that Apple is now on track to produce its own 5G modems. The two companies only recently resolved their differences, at which time Intel announced its departure from the 5G phone business. Bloomberg cited analysts at the time who said that Apple-built modems might be ready by 2022.

Apple’s SVP of Hardware Technologies Johny Srouji said that the deal will “help expedite our development on future products and allow Apple to further differentiate moving forward.”



Building its own modems could potentially have major advantages for Apple. It will enable it to develop new technology as and when needed, improve the integration of those modems with its own products, and come up with new features to give its devices a competitive advantage.

The deal will also make Apple less dependent on Qualcomm, which it has accused of asking for unreasonably high patent royalties in return for access to its hardware in the past. In April, the two firms signed a six-year patent licensing deal.

Buying a supplier to bring its technology in-house is a tactic that Apple also used when it forked out $300m to buy into Dialog, a firm that earlier supplied it with power management chips for smartphones. With that acquisition, Apple took over 300 Dialog employees.

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Chris

I've been a passionate evangelist for Apple and the Macintosh throughout my working life, my first love was a Quadra 605 working with a small creative agency in the south of Norfolk UK in the mid 1990's, I later progressed to other roles in other Macintosh dominated industries, first as a Senior graphic designer at a small printing company and then a production manager at Guardian Media Group. As the publishing and printing sector wained I moved into Internet Marketing and in 2006 co-founded blurtit.com which grew to become one the top 200 visited sites in the US (according to Quantcast), at its peak receiving over 15 million visits per month. For the last ten years I have worked as an Affiliate and Consultant to many different business and start ups, my key skill set being online marketing, on page monetisation, landing page optimisation and traffic generation, if you would like to hire me or discuss your current project please reach out to me here.

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