Apple Buy Intel Smartphone Modem Business For $1B
Apple and Intel have signed an agreement for Apple to acquire the majority of Intel’s smartphone modem business in a deal valued at US$1 billion.
The deal gives Apple more power to customise and control the technology in its smartphones at a time when the industry is moving towards 5G cellular connections.
Around 2,200 Intel employees will join Apple through this agreement, with Apple also acquiring IP and equipment from Intel.
“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,” said Intel CEO Bob Swan.
“We have long respected Apple and we’re confident they provide the right environment for this talented team and these important assets moving forward.”
“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.”
Combining the acquired patents for current and future wireless technology with Apple’s existing portfolio, Apple will hold over 17,000 wireless technology patents, ranging from protocols for cellular standards to modem architecture and modem operation.
Intel will retain the ability to develop modems for non-smartphone applications, such as PCs, Internet-of Things devices and autonomous vehicles.
“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.”
The news comes after Intel announced it would be exiting the 5G smartphone modem business in April this year to instead focus its resources on building 5G infrastructure.
The transaction is expected to close in Q4 on 2019, subject to regulatory approvals and other customary conditions, including works council and other relevant consultations in certain jurisdictions.