Apple’s ongoing dispute with Qualcomm looks like it will have a big impact on the components used in this year’s upcoming iPhone models, according to Qualcomm Chief Financial Officer George Davis. On an earnings call this afternoon, Davis said, “Apple intends to solely use our competitor’s modems rather than our modems in its next iPhone release,” as reported by CNET. Davis didn’t mention Intel by name, but Intel is the only other supplier of that component for Apple’s smartphones.
That lines up with a report earlier this month from KGI analyst Ming-Chi Kuo, which said that Apple would ditch Qualcomm as its long-time supplier of cellular modems as a result of its legal dispute with the chipmaker. With the roll out of 4G, Apple began using both Qualcomm and Intel modems, though Qualcomm has long prided itself on providing faster components. The company this week touted speed tests for its Snapdragon 845 chip as proving its products are superior than Intel’s, possibly in an attempt to preempt negative reaction to Davis’ revelation today.
Apple and Qualcomm are currently engaged in a bitter patent infringement and royalty dispute over Apple’s use of Qualcomm technology and the amount of money the chipmaker charged Apple for use of its components and patents. Apple initially sued Qualcomm in early 2017 for allegedly overcharging to use its LTE modems, which are essential to helping smartphones connect to the internet.
Qualcomm then counter-sued, saying Apple owed it more money in royalties, and furthermore that the iPhone maker infringed on some its patents and shared proprietary information with Intel. Qualcomm has also tried to get numerous iPhone models banned from sale in the US, unsuccessfully.
The two have since continued to file lawsuits against one another as formal business relationships between them have all but deteriorated completely. Complicating the situation is that Qualcomm expects to have its 5G modems shipping with devices later this year, potentially starting first with mobile hotspots and moving on to smartphones, while Intel has said publicly that it won’t have 5G chips ready until 2019.
Apple is also said to be distancing itself from Intel components in other areas, like Bluetooth and Wi-Fi mobile chips and MacBook processors, though there’s no indication that would necessarily harm Apple’s relationship with Intel regarding cellular modems. That said, Apple could still use another partner like MediaTek, or there is the small chance it could repair its relationship with Qualcomm if Apple feels like it’s missing the boat on 5G, although that seems increasingly unlikely at this stage.
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