Apple acquires Intel’s mobile modem branch

Apple buys the vast majority of Intel’s business unit that makes modems. Some 2,200 employees are transferred to Apple and the iPhone maker receives patents and equipment. Intel continues to make modems for PCs and other devices.

Apple and Intel have reached an agreement and expect the deal to be completed by the end of the year if several regulators have considered it. Apple reports that the agreement will result in approximately 2,200 Intel employees transferring to Apple, including part of the intellectual property, equipment, and rental contracts. The transaction is valued at one billion dollars.

The deal does not mean that Intel will completely abandon the modem trade, since it will still develop 5G modems for, for example, IOT devices, autonomous vehicles and PCs; the acquisition by Apple concerns modem chips for smartphones. For Apple, the transaction means that in time it will be much better able to make 5g modems for its smartphones, without being completely dependent on a party like Qualcomm.

Intel says that the acquisition allows the company to focus on developing technology for the 5G network and that important intellectual property and important modem technology remain in their own hands. Apple is talking about a “significant purchase of innovative intellectual property” that will help expand the development of future products and enable Apple to differentiate further in the future.

Intel already announced in April that it would no longer continue with the development of 5g modems for smartphones. That step was a direct consequence of the settlement that Apple and Qualcomm concluded. Apple also said that in the coming years it will only purchase modems from Qualcomm. The iPhone maker was Intel’s only major customer for modem chips for smartphones.