Apple to purchase major bulk of smartphone modem business of Intel

Intel is struggling with its smartphone modem business but has now found a suitor. The company recently announced that in conjunction with Apple, the tech company along with Intel’s most important customers, would be buying a bulk of the smartphone modem business of Intel for $1 billion. The announcement was made through a joint press release from Apple and Intel and they also announced that they have signed an agreement for Apple to buy a majority (but not the entirely) of Intel’s smartphone modem business.

The terms of the agreement say that Apple will get Intel’s modem IP, related product teams equipment and property leases. However, the deal only covers the smartphone modems while Intel retains some of the critical IP and the option to build modems for non-smartphone uses like PCs, IoT applications and autonomous vehicles. This also includes the infrastructure business where Intel will continue to build 5G solutions for network operations and other large customers.

The deal has also mentioned that Apple will pay Intel $1 billion in cash for the smartphone business and the two companies expect the deal to close in the fourth quarter. For the money, the Cupertino based company will be picking up around 2,200 Intel employees along with Intel’s patents related to the smartphone modems that includes 2G, 3G, 4G and 5G modems. Apple is now all set to hold more than 17,000 wireless technologies patents once the deal closes. Among others, Apple owns IP related to protocols of cellular networks, modem architecture and modem operation. Some of the IP that Apple is buying was originally developed by Infineon’s wireless division, more than a decade ago.

The Intel’s smartphone modem IP purchase and a transfer of employees is a strong indication that Apple is planning to develop its own modems. For now the company has remained one of the last users of discrete modems.

Photo Credits: Mac Rumours