Apple buys ‘majority’ of Intel’s smartphone business for US$1 billion

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Apple is moving forward with its plans of developing its own cellular hardware with its latest acquisition. The company is buying the “majority” of Intel’s smartphone modem business for US$1 billion. It’ll see Apple taking on 2,200 Intel employees, intellectual property, and leases. The deal is expected to close in the fourth quarter of this year if regulators approve of the handover, that is.

In the smartphone chipset market, Intel won’t be completely out of the game. But it’ll scale back. And its focus on 5G will be in areas where it “most closely aligns” with what its customers want. The focus would be on customers like network operators, cloud service providers, and equipment manufacturers. The company will also work on developing modems for computers, Internet of Things devices, and self-driving cars.

It’ll allow Intel to refocus and grow in areas where it can excel. And perhaps Intel wasn’t left with much of a choice. When Apple and Qualcomm settled its patent dispute and signed a multi-year chipset deal that effectively negated any chance for Intel modems to appear in Apple devices. Their recourse would be to persuade Android phone manufacturers to adopt its modem, which is a tough ask considering Qualcomm’s dominance in that space.

For Apple, this purchase is as much about acquiring talent and ideas that will align with the company’s long-term goal of improving its performance and giving it greater independence to develop the products it wants.

Source: Engadget