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Intel to Exit 5G Smartphone Modem Business

Intel has announced that they are exiting the 5G smartphone modem Busness just hours after the Apple/Qualcomm settlement. The company will continue its comment to current 4G smartphone modem commitments but will focus their 5G efforts around Internet of Things (IoT) and modems for always connected PCs.

We are very excited about the opportunity in 5G and the ‘cloudification’ of the network, but in the smartphone modem business it has become apparent that there is no clear path to profitability and positive returns,” said Intel CEO Bob Swan. “5G continues to be a strategic priority across Intel, and our team has developed a valuable portfolio of wireless products and intellectual property. We are assessing our options to realize the value we have created, including the opportunities in a wide variety of data-centric platforms and devices in a 5G world.

Bob Swan, CEO of Intel

The news essentially locks the iPhone to Qualcomm based 5G modems which was not surprising given the multi-year agreement the companies announced as part of their legal settlement. There is little choice for Apple outside of Qualcomm from a manufacturing perspective.

Intel had been testing a 5G modem for Apple, the XMM 8160. However, rumors have suggested that Apple has been unhappy with the progress that Intel has made on the modem. Most of these issues have reportedly been around power consumption and heat sink issues. These rumors, not confirmed, have given Apple pause on if Intel was up to the task. Now, it seems, it is moot.

As previously reported, Apple is committed to Intel modems for the 2019 iPhone given the late stage of design of this year’s model. For 2020 it seems that Qualcomm will be the manufacture of choice. By 2021 however, Apple could be producing their own 5G modem as they look for more control of their chip designs and manufacturing. This also cuts their reliance on Qualcomm for every chip they need.

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