As the tech community prepares for the inevitable shift towards 5G technology, so does tech companies. Recently, tech giant Apple confirmed that it had bought the smartphone modem division of notable chipmaker Intel. Apple reportedly paid $1 billion to acquire the division, and many analysts believe that the company is making a huge investment towards the future with its bet on 5G technology.
In a statement, Apple said, "Combining the acquired patents for current and future wireless technology with Apple's existing portfolio, Apple will hold over 170,000 wireless technology patents, ranging from protocols for cellular standards to model architecture and modem operation."
Apple added that Intel will still have the option to develop modems for non-smartphone applications. This includes modems for personal computers, autonomous vehicles, and internet-of-things devices.
Many analysts have noted that Apple's recent acquisition means that the company is starting to consolidate some of its hardware providers. Apple will most likely develop modems to be used into its devices like the iPhone and the iPad, and will not sell this to other companies.
Regarding the acquisition, Apple did not disclose how it plans to pay the $1 billion bill for Intel's modem business. Nevertheless, that is such a small amount compared to the company's current resources, which are valued at $225 billion.
The acquisition is also a big boost for Intel. The company's modem division is not exactly the first choice for many smartphone manufacturers, and it faces great competition from giants like Qualcomm and Broadcom. Intel even announced in April that the company would be ditching its work on 5G technology for smartphones.
Apple is known for acquiring companies and startups that play a major role in its supply chain. In fact, this is the very strategy that helps Apple be the first to introduce revolutionary features in the smartphone industry. The company is first to introduce advanced augmented reality, and face unlock features.
The 5G technology is still in its infancy. While Apple did make this huge acquisition from Intel, it will be years before a 5G iPhone using Intel's hardware and technology will be released into the market. As of this writing, Apple still relies heavily on Qualcomm for its smartphone modems. Since Qualcomm is well ahead of the competition when it comes to 5G technology, there is a great possibility that the first Apple iPhone will use a Qualcomm modem.
Aside from modems, Apple is also developing its own processors and graphics cards. There are even rumors that the company might drop Intel's desktop processors in favor of its own in-house chips within the next few years.
