Apple will acquire the majority of Intel’s smartphone modem business towards the end of 2019. Apple and Intel have signed an agreement with transaction value worth $1 billion, in which approximately 2,200 Intel employees will join Apple, along with intellectual property, equipment and leases, Apple noted in a joint press statement on Thursday.
The signed deal is expected to go through by the fourth quarter end of 2019. It will of course depend upon regulatory approvals and other customary conditions. It’ll not just help Apple to expedite development of future products, but will also reduce Apple’s reliance on Qualcomm. Apple have been using Qualcomm modems in its smartphone, but now they don’t have to.
“We’ve worked with Intel for many years and know this team shares Apple’s passion for designing technologies that deliver the world’s best experiences for our users,” said Johny Srouji, Apple’s SVP of Hardware Technologies. “Apple is excited to have so many excellent engineers join our growing cellular technologies group, and know they’ll thrive in Apple’s creative and dynamic environment. They, together with our significant acquisition of innovative IP, will help expedite our development on future products and allow Apple to further differentiate moving forward.”
Apple-Intel agreement doesn’t meant that Intel will get out of the modem business entirely. Intel will still be able to develop modems for categories other than smartphones such as PCs, IoT devices, autonomous vehicles, and more. At present the company is looking forward in putting their full effort into 5G modem technology.
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“This agreement enables us to focus on developing technology for the 5G network while retaining critical intellectual property and modem technology that our team has created,” said Intel CEO Bob Swan. “We have long respected Apple and we’re confident they provide the right environment for this talented team and these important assets moving forward. We’re looking forward to putting our full effort into 5G where it most closely aligns with the needs of our global customer base, including network operators, telecommunications equipment manufacturers and cloud service providers.”