Apple Considered Purchasing Intel's Smartphone Modem Chip Business

[bluecoast]

Agree with a few other posts here.

Suspect that apple has agreed to use QC’s 5g modems for 5 years or so exclusively from 2020 (or whenever apple ships their first 5g iPhone).

This gives them half a decade to build out their own 5g modem. If that’s true I’d expect them to want to acquire intel’s patents, IP and key people to help them achieve this.

I wonder how apple are doing developing their other Achilles heel - screen tech?

10 years into the iPhone, Apple has allowed themselves to become hugely dependent on Qualcomm and Samsung. I suspect that that kills them everyday. Ditto the increasingly political hot potato of mass manufacturing in China.

 

[dwaite]

Rumors are that Intel would have outsourced their 5G modem production to TSMC to take advantage of their smaller process.

Part of Intel missing their process deadlines is that they haven't built new fabs and scaled up to meet their production needs. There have been runs on certain Intel chips as a result.

It may not be just to take advantage of the process, but that they literally can't currently dedicate the floor time to manufacture 100M modems.
[doublepost=1556354936][/doublepost]

Read the post directly above this one. If 5g doesn’t translate into notable real world, noticeable gains, then it’s borderline useless. Period.

For whom? It could go 10% slower but support 20x more people on a tower, and the telcos would eat it up.
[doublepost=1556355225][/doublepost]

Why not? If Qualcomm invested and invented new technologies to have better Internet, then it deserves to have full rights to these new technologies its team has created. Qualcomm is a for profit organization, this is how capitalism works and every company should be rewarded for its inventions/discoveries.

If Qualcomm wanted a purely proprietary Qualcomm wireless tech, they can charge as much as they want for it. But when they decided to participate in an industry organization focused on interoperability, they made certain commitments to charge a fair and non-discriminatory price for access to any inventions essential for implementing those standards.

In addition to contract law there, it has become enough of a problem that governments have started to step in and restrict the power of the government-issued patents to limit interoperability for such standards.

 

[novakk86]

What is so special about 5G? Sure its faster but LTE is already fast so why is everyone obsessed about 5G? Also, it will take years before the coverage is present so surely there is no rush

The main advantages of 5g (next to speed) are suppose to be ~0 latency and more stable connection, allowing for some new use cases, not just faster download of "pron"

 

[nebo1ss]

Being an apple supplier is certainly not a bed of roses. Intel made hugh loses on building modems for Apple. This means only one thing it was costing them more to supply the product to Apple than Apple was paying for it. Unfortunately there is a long list of vendors who regret ever doing business with Apple.

 

[ksec]

1. Interesting the talk started last Summer, which was right when ex-CEO BK was out. i.e I think Apple knew without the support of BK and Aicha Evans, both incidentally left Intel last year. It is highly unlikely who ever picking up the job will support Apple in the long term. Given the lead time in Modem design, testing and shipment. It was possible the best for Apple to make the move then.

2. WSJ also suggest Intel is working with Goldman Sachs to facilitate negotiations.....um... why does the name ring a bell, oh Apple Cards. I mean seriously, there just isn't another possible buyer other than Apple. Both Huawei and Samsung already has their own, working Modem team. Other Top 6 Smartphone manufacturers are all Chinese I doubt they will pass the deal in whatever national security reason (Unless the price is super high of course ). Modem requires annual unit shipping volume, and only Apple fits the criteria and needs.

3. If the started late summer in August, that is 8 months already. Looks like Apple is trying to get ultra low price again.

4. Finally, I was shocked when intel acquired Infineon. And had always wished they worked with Apple for longer, now it comes a full circle and finally Infineon is back to Apple again.

 

[Romeo_Nightfall]

What is so special about 5G? Sure its faster but LTE is already fast so why is everyone obsessed about 5G? Also, it will take years before the coverage is present so surely there is no rush

5G is a political agenda for full surveillance, they make seem everyone obsessed - there are many who don’t want it at all out there!

 

[Marekul]

You have the think of the big picture. 5G isn’t going to be big for phones it will be big for everything else internet connected.

I live in Australia where most the population lives on the coast line. Or in small isolated towns in the middle. But most the middle isn’t populated. This makes wireless connectivity far easier to implement then rolling out hundreds and hundreds of miles of fibre optic cable to give the small towns decent internet speeds.

We already have an awesome phone network that already covers theses areas. An upgrade to the tower means that town gets fast speeds, not for phones but for internet on their computers, remote hospitals etc.

Also think of the application with drones flying and relaying information back. With more data steam more information can be sent back to a remote location.

5G isn’t for phones. It’s building a network for more than just phones.

5g is not cheap to implement, and current tower infrastructure isn’t helping a lot because you need lots of new high power 5g cells to have acceptable penetration. So you will be laying tons of fiber anyway...and then bottleneck it with 5g and have it resold by mobile companies for high pricens instead of connecting general population directly to fiber.

As other have said before your drones and cars will not profit from 5g it’s not how things work.

 

[PinkyMacGodess]

I'm sure Intel was also afraid of running into a patent war with Qualcomm and potentially others. Qualcomm has bet the farm on their modem business.

 

[cableguy84]

Love all the armchair chip experts in this forum

 

[PinkyMacGodess]

5g is not cheap to implement, and current tower infrastructure isn’t helping a lot because you need lots of new high power 5g cells to have acceptable penetration. So you will be laying tons of fiber anyway...and then bottleneck it with 5g and have it resold by mobile companies for high pricens instead of connecting general population directly to fiber.

As other have said before your drones and cars will not profit from 5g it’s not how things work.

I don't know about anywhere else, but they have been laying fiber around here like it was spring break! Every month a new crew is pulling fiber somewhere along highways and local streets. The build out has been continuing for decades. There is a major fiber run for AT&T right off my driveway. I saw them pulling it. I wish I could tap into it. For all of the prognostications of the companies stopping investment into their infrastructure, they know they have to, and are. They don't need higher prices to keep upgrading their infrastructure, they need high prices to keep upgrading their planes, and offices! Between the telcos and Wall Street, they probably vacuum up most of the mahogany and marble trim for business jets and office renos. It's good to be the king...

 

[Fixey]

Interesting! I wonder if this means Apple has given up on making their own modems? I mean, that would maybe be sensible, but kind of boring/disappointing too.

Far from it, Apple knows that acquiring intel model will give them access to more technology that they can include in their own modem chip as well as the patient rights to them.

 

[iBluetooth]

One word:
Latency

Tests of current 5G installations showed the same latency as 4G, slightly higher speed. So, there is a lot to look for but I think it will take years until we get what is promised!

 

[bruinsrme]

Part of Intel missing their process deadlines is that they haven't built new fabs and scaled up to meet their production needs. There have been runs on certain Intel chips as a result.

It may not be just to take advantage of the process, but that they literally can't currently dedicate the floor time to manufacture 100M modems.
[doublepost=1556354936][/doublepost]

For whom? It could go 10% slower but support 20x more people on a tower, and the telcos would eat it up.
[doublepost=1556355225][/doublepost]

If Qualcomm wanted a purely proprietary Qualcomm wireless tech, they can charge as much as they want for it. But when they decided to participate in an industry organization focused on interoperability, they made certain commitments to charge a fair and non-discriminatory price for access to any inventions essential for implementing those standards.

In addition to contract law there, it has become enough of a problem that governments have started to step in and restrict the power of the government-issued patents to limit interoperability for such standards.

This is why intel is building out 42, 38 and I believe D2.

 

[justperry]

I’m seeing a 26ms ping on my LTE on my 2017 iPhone X. I just ran Speedtest from inside the office building I work in.

Seems fine, pretty darn low latency really.

For just regular browsing it's fast enough, but not for the next decade where more and more devices are connected or even remote controlled.

Exactly, 1.5 ms vs 60 ms is huge.

Mine is less than half, 24 ms just now, but yeah, even that is much slower than what we will get with 5G.

 

[name99]

Correct me if I’m wrong but Apple’s new deal is worse than their old one. Seems like to me Apple folded because of 5g.

You're wrong.
The new agreement has
- Apple paying a one time fine (no big deal, covers money Apple withheld over the past two years)
- slightly more in fees/phone ($7.5->~$9) -- which looks like a loss BUT
- gives Apple guaranteed access to QC IP, and THAT is the win

Basically Apple didn't get everything they WANTED (no-one ever does) BUT Apple got everything they NEEDED.
What's important is that Apple can go forward to make their own modems, not the minor details of a dollar here or there.
[doublepost=1556377298][/doublepost]

Being an apple supplier is certainly not a bed of roses. Intel made hugh loses on building modems for Apple. This means only one thing it was costing them more to supply the product to Apple than Apple was paying for it. Unfortunately there is a long list of vendors who regret ever doing business with Apple.

Uh, wot?
Intel wanted to be in modems for years. It acquired Infineon in 2010. It approached Apple year after year asking to be considered. And Apple certainly didn't stop Intel from delivering a 5G modem, or persuade them of the lunatic strategy to bet EVERYTHING on 10nm, then ignore the warning signs that the process was going wrong year after year after year.

"Unfortunately there is a long list of vendors who regret ever doing business with Apple."
How about there's a short list of vendors who have lied about what they can deliver to Apple, and Apple eventually dropped them as a result? Intel obviously, and GT Advanced, and PowerbyProxi.

PowerVR certainly made a big deal about how they were wronged, how much Apple sucked, and how they were going to sue them. That lawsuit never happened, which kinda suggests...
PowerVR and Dialog seem to have followed a similar pattern whereby Apple concluded that they could do better than those companies could. At that point the companies had to make a choice about how to go forward --- do better to retain Apple's business, sell them IP or a division, or pretend they were invincible. PowerVR tried to play chicken and lost; Dialog was rather more sensible and did OK.

Meanwhile as far as I can tell the vendors that deliver to Apple without drama and without promising what they can't deliver do just fine. TSMC looks OK. Samsung and the flash and DRAM vendors look OK. The display vendors look OK.

 

[ksec]

Basically Apple didn't get everything they WANTED (no-one ever does) BUT Apple got everything they NEEDED.
What's important is that Apple can go forward to make their own modems, not the minor details of a dollar here or there.

Nice, I like that explanation. Much better than what I did.

I am guessing the same name99 as on Anandtech?

 

[Ramchi]

It’s bad for the industry if there is only one supplier.

But QC allowing licensing of their patents which is probably used by Samsung and others for their modems. Apple can still make it using QC patents. Since they have entered % basis for charging (of the total value or the total cost) Apple is probably fuming. One player will be a problem only if they refuse licensing like Apple.

 

[Freida]

Apparently Tim Cook disagrees with you otherwise he wouldn’t have needed to settle.

Tim Cook was never the man that would scream "innovation" etc. Even though I like Tim as a person and how he handles Apple I dislike how 'boring' his style is.

 

[carrrrrlos]

Silicone hands are getting more and more realistic.

 

[realtuner]

Correct me if I’m wrong but Apple’s new deal is worse than their old one. Seems like to me Apple folded because of 5g.

You're wrong.
The new agreement has
- Apple paying a one time fine (no big deal, covers money Apple withheld over the past two years)
- slightly more in fees/phone ($7.5->~$9) -- which looks like a loss BUT
- gives Apple guaranteed access to QC IP, and THAT is the win

Basically Apple didn't get everything they WANTED (no-one ever does) BUT Apple got everything they NEEDED.
What's important is that Apple can go forward to make their own modems, not the minor details of a dollar here or there.

I’d say that paying the extra $1.50 (from
$7.50 to $9 per iPhone) is a steal. Basically Apple is paying $1.50 for 5G.

 

[ApfelKuchen]

Will Apple buy Intel's modem operation (or continue to hire Intel's modem talent as they depart)? The last chapter is far from written. I don't think it's a matter of the QC settlement shutting the door on Intel. What Apple likely wants is greater than either a QC settlement or an Intel acquisition alone can offer.

Apple wants in radios (which encompasses cellular, Wi-Fi, Bluetooth, NFC, and whatever else the wireless future brings) is what it currently has with its mobile SOCs - a combination of high performance in generic functionality, plus ecosystem-unique features. They've been on that path for a while with Bluetooth and previously, WiFi (though I think AirPort may be back, re-branded).

This is not a matter of spec-sheets-for-geeks - it's a matter of, "It just works," real-world performance for non-techie end-users that supports Apple's top-end price point/reputation. If that performance/feature set is limited to what any other mobile device manufacturer can buy from the QCs and Intels of the world, it's harder to distinguish Apple's products from the rest.

Unlike the other chipmakers, who develop new capabilities so that they can be incorporated into industry standards and collect royalties from every other maker of standards-compliant hardware, Apple seeks, additionally, to have unique selling points for the Apple ecosystem. So, a certain, cool little feature that QCs engineers might have brought to the standards-setting table might be held back by Apple's engineers as Apple-exclusive.

QCs patents simply keep Apple on an equal footing with the rest of the industry. Intel's engineering team... most are likely to be applications-oriented - incorporating industry standards into a functioning product. Maybe Intel has some "special sauce" in the pipeline that could help distinguish Apple's future products, maybe not. Apple is already intimately aware of what Intel has "inside," and whether that fits their long-term strategy.

 

[dannyyankou]

p.s.: Really no need to watch 4K content on a tablet on mobile data. I have 65" tv for that and even if I ignore the idiocy of the proposal I still can safely tell you that 5G next year has little to no value for customers. That value is at least 4 years away if not more.
We could also bring the debate whether or not you would be able to see a difference between 4K or FHD on an iPad. But that would be for another topic and I'm sure you would not be honest with me

Well that’s the point I’m making, you wouldn’t be able to tell the difference between 4K and HD on an iPad right now because the technology and resolution doesn’t support it. This is about the future, I’ll be shocked if there aren’t 4K iPads in the future. It sounds like overkill, but people thought 1080p on a phone was overkill. Now every phone has it.

 

[Bruce Oksol]

What is so special about 5G? Sure its faster but LTE is already fast so why is everyone obsessed about 5G? Also, it will take years before the coverage is present so surely there is no rush

I'm not a techie. I understand none of this.

However, if you can read wiki you can find out why 5G is a game-changer. Speed is a peripheral issue; speed is not the reason folks are excited about 5G.

IoT: television, house security, Ring, doorstep video, house utility, Echo Dot, garage door opener, coffee maker -- all linked via cell or wifi. But if off-site, must have cell (not wi-fi).

A square kilometer using 4G can only handle 4,000 devices. A square kilometer using 5G can handle 1 million devices. Imagine all the cellular devices in a square kilometer in NYC, Washington (DC); DFW; Chicago, and it doesn't take a rocket scientist to sort this out.

 

[Freida]

Well that’s the point I’m making, you wouldn’t be able to tell the difference between 4K and HD on an iPad right now because the technology and resolution doesn’t support it. This is about the future, I’ll be shocked if there aren’t 4K iPads in the future. It sounds like overkill, but people thought 1080p on a phone was overkill. Now every phone has it.

it is still overkill

 

[dampfnudel]

Interesting! I wonder if this means Apple has given up on making their own modems? I mean, that would maybe be sensible, but kind of boring/disappointing too.

Apple usually gets cold feet when they fully realize the complexities involved in being fully engulfed in the manufacturing of their products. You also don’t have to look in the mirror when something goes wrong.