Apple acquires majority of Intel’s smartphone modem business

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Apple acquires Intel's modem division for $1 billion

Acquisition is Apple’s most expensive since buying Beats for $3.2 bn in 2014

Apple and Intel has reached an agreement for Apple to acquire the majority of Intel’s smartphone modem business.

The transaction is valued at $1 billion and is expected to close in Q4 2019. It is Apple’s most expensive acquisition since its $3.4 billion purchase of Beats Technologies in 2014, and its second-largest ever.

It will see around 2,200 Intel employees join Apple, and more than 17,000 wireless technology patents come under Apple’s ownerships. Intel will retain the ability to develop modems for non-smartphone applications, including PCS, IoT devices and autonomous vehicles.

“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.”

Apple’s senior vice president of hardware technologies Johny Srouji added: “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.

“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.”

Apple has previously relied on outside suppliers for its modems, such as Qualcomm, with whom it settled a legal dispute in April. The acquisition lends credence to beliefs that Apple wants to make its own modem for its rumoured 5G iPhone to be released in 2020.

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