THR RUMOURS WERE TRUE: Apple has bought the "majority" of Intel's smartphone modem business in a bid to kickstart its in-house 5G hardware efforts.
The $1bn (around £802m) deal will see approximately 2,200 Intel employees upping sticks to Apple and also includes intellectual property, equipment and leases. The transaction is expected to close in the fourth quarter of 2019, assuming it's given the thumbs up from regulators.
Intel won't be getting out of the modem business entirely, though. It's still able to develop cellular hardware for anything that isn't a smartphone; think autonomous vehicles, IoT devices and PCs.
"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," remarked Intel CEO Bob Swan.
"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."
Apple, on the other hand, will use the acquisition - which includes 17,000 wireless technology patents - to ramp up its own 5G modem efforts in a bid to lessen its reliance on frenemy Qualcomm.
Though the two firms only recently resolved their long-running dispute related to patent royalties, in turn forcing Intel out of the 5G smartphone business, reports have long claimed that Apple is aiming to have its in-house modems ready in three years' time, with the first 5G-capable iPhone rumoured to show up as early as 2021.
Apple's transition to in-house cellular hardware won't be without its headaches though, particularly as the company still has a deal with Qualcomm to use its chips for the next six years as part of the firm's recently-agreed a "multiyear chipset supply agreement".
What's more, the US chipmaker's modems have consistently outperformed Intel's alternatives, boasting "double-digit gains" in latency and "triple-digit gains" in download and upload speeds, so it's going to take a hell of a lot of work to knock it from its market-leading perch.
"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 senior vice president 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." µ
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