Apple has announced the acquisition of chip-maker Intel's smartphone modem business for $1 billion. Approximately 2,200 Intel employees will join Apple, along with intellectual property, equipment and leases, the Cupertino-based iPhone maker said in a statement late Thursday. The transaction is expected to close in the fourth quarter of 2019.
"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'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," he added.
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. Johny Srouji, Apple's senior vice president of Hardware Technologies said that Apple is excited to have excellent engineers join its growing cellular technologies group."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," he added.
Apple has been working on its own chips for quite some time. Acquiring Intel's technology could help the iPhone maker accelerate its plans. Apple may have paid chip-maker Qualcomm somewhere between $5 billion-$6 billion for an agreement to dismiss all ongoing litigations, including those with Apple's contract manufacturers. Intel had been working on a chipset for the iPhone maker, with the chip expected to be part of iPhones by 2020.
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