Apple announced that they will purchase Intel’s Modem business for $1 billion. The deal was expected for a long time as Intel was looking for buyers for its modem business. The deal is expected to complete by the end of this year, in which Apple will receive the modem business from Intel along with several patents and 2,000 employees. Apple was trying to develop a new modem for 5G capability but failed miserably, so did Intel in the same journey. Now, Apple will get access to the Intel’s modem business resources and can quickly work on the development of powerful network chips.
After breaking up with Qualcomm over the disputes, Intel was Apple primary chip supplier for nearly two years. Intel was working on the 5G network chips for the smartphone, but the project was not seeing any progress. With the declining share in the market, Intel decided to sell the modem business and focus on the memory chip business. Apple has also setup a new R&D department in a secret place that focused on the development of the 5G network chips for the iPhone. The R&D was developed to ditch Intel and create more powerful chips on their own.
Recently, Qualcomm and Apple settled the lawsuit and started a business together again. But, the ambitious plans of Apple were not finished. With the opportunity to buy a separate Modem business that comes with all of the patents and the employees, Apple closed the deal. As Intel was already struggling in the Modem business, the Settlement between Apple and Qualcomm hit the final nail in the coffin, as Apple was the sole buyer of Intel’s modem chips. As Apple is going to have control over Intel’s Modem business, this does not mean that the company could launch the 5G chips this year. The project is intended for long-term, which will ensure the independence of Apple for Network chips.