Great. This will provide Apple with multiple benefits.
Size/power savings
The Qualcomm chip is a complex thing. It is so complex that it has its own ARM processor inside running its own little operating system. It takes quite a lot of space on the board:
Some of the code Qualcomm’s CPU is running could probably run on Apple’s main CPU. Apple’s CPU cache could also be reused. The remaining baseband-specific stuff could be implemented as separate blocks inside Apple’s chip package, just like Imagination’s GPU. That would cut down on space.
The power savings could be provided by elimination of redundant hardware across multiple chips, Apple’s P.A. Semi chip power-saving tricks, and Apple’s software better managing baseband power states.
Cost savings
Take a look at this table:
The Qualcomm chip costs about $32. It is one of the most expensive components. Apple could probably make their own wireless chip for $15–20. Or maybe integrate it into their next A
n chip so that the total cost is about $25–30. Of course, there are some tricky patent licensing costs involved, but it still may be more cost-efficient for Apple to do its own stuff.
Plus, if they’re going to do their own LTE chip, they’re surely going to do their own Wi-Fi/BT/GPS as well. That’s another $4 off.
Innovation opportunities
Apple would be in control of its wireless R&D schedule, aligning it to its own product roadmap.
They could start by moving much more aggressively along LTE Releases 10/11/12, partnering with select carriers around the world to do that. Sort of like Samsung has partnered with SK Telecom to launch 150Mbps LTE-A in South Korea.
They could also implement new LTE features that do not require carrier network upgrades, but do require control of all components; for example, “in-device co-existing”, which eliminates interference between LTE/Wi-Fi/BT radios by co-ordinating their transmission.
After a couple of R&D cycles, they could attempt innovations that no other companies would do. Maybe some wild transceiver/antenna design that would let them get rid of plastic “windows” in cases. Or maybe software-defined radios that could be upgraded in software to work with newly vacant radio frequencies.