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Apple Close To USD 1 Billion Deal To Buy Intel Modem Chip Business

Apple is in advanced talks to buy Intel’s smartphone-modem chip business, people familiar with the matter told the Wall Street Journal. A deal to acquire USD 1 billion in assets, including patents and staff, could be reached in the next week, the report said.

The Information reported similar talks a month ago between Intel and Apple.

Apple used Infineon modems when it first launched the iPhone until the acquisition by Intel in 2011. It relied again on Intel in 2016-18 during its licensing dispute with Qualcomm. More recently, Intel announced plans to exit the smartphone business, after Apple struck a new licensing agreement with Qualcomm.

The takeover would give Apple access to engineering work and talent to develop its own modem technology and prepare for 5G devices. The company is hoping to reduce its reliance on key suppliers as well as diversify its supplier base in order to avoid disruptions to its production.

For Intel’s part, a deal would allow the company to shed a business that had been weighing on its bottom line: The smartphone operation had been losing about USD 1 billion annually, a person familiar with its performance told the WSJ. Though it would exit the smartphone business, Intel plans to continue to work on 5G technology for other connected devices.―Telecompaper

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