Apple plans to develop its own CPU and GPU production in-house, and rumors of Apple manufacturing its own 5G modems have been circulating since 2019. Apple first announced that they have started developing a modem in December 2020. The first own silicon modems are expected to arrive in 2022 iPhones, but the new investors report by Ming-Chi Kuo revises it to “2023 at the earliest.” This is consistent with an earlier analysis by a team of Barclays analysts, who also point to 2023. Both sub-6 and mmWave 5G will be supported by the modem.
To Recall, a few months ago, Apple announced a €1 billion investment to manufacture a new R&D center in Munich, Germany. Although the company’s primary goal is to develop 5G gears and future wireless technologies, the company intends to explore other technologies. Apart from Apple’s willingness to manage the whole hardware and software stack for its devices, the modem market seems to be very controversial.
In 2018, Apple dropped its long-term modem provider, Qualcomm, and switched to inferior Intel designs due to a patent dispute. However, Intel’s modem division failed to produce a profit so the company left the market and sold its division to Apple in 2019 for $1 billion. This would be Apple’s initial stage for creating its own 5G modems. However, for the time being, the firm has returned to Qualcomm – court papers confirmed that the iPhone 12 series uses the X55 5G modem and that there is an agreement in force until 2023 to use a combination of X65 and X70 modems for the iPhone 13 and 14 generations. Apple boosted Qualcomm’s revenues to new highs last year. This means that Apple has a backup plan in place in case its own 5G modem isn’t ready for rollout in 2023. But if Apple succeeds, Qualcomm would lose millions in orders.
To make up for lost revenue. Kuo claims Qualcomm can drive 5G designs harder into the mid-range and even entry-level segments. Another looming problem is that the company’s current chip scarcity gives it a lot of bargaining power right now, but it will wear off and Qualcomm (and even MediaTek) will feel pressure to cut costs.