Apple is reportedly unable to produce the 5G modem for the 2023 iPhone, as it had hoped. It will instead have the buy the critical component from Qualcomm, a company that Cupertino has quarreled with in the past.
Cupertino already sank more than a billion dollars into this so-far-unsuccessful effort.
iPhone will have to stick with Qualcomm 5G modems
Qualcomm currently produces the cellular chips found inside iPhones and iPads. But after Qualcomm won a bitter, multi-year court fight over royalties and patent infringements, Apple has been developing its own 5G modem. This might save the iPhone-maker some money. (And there’s probably some spite involved.)
If that happens, it won’t be in 2023, as had reportedly been the plan. Analyst Ming-Chi Kuo from TF International Securities said Tuesday via Twitter, “My latest survey indicates that Apple’s own iPhone 5G modem chip development may have failed, so Qualcomm will remain exclusive supplier for 5G chips of 2H23 new iPhones.”
Despite initially characterizing the effort as a failure, Kuo went on to say, “I believe Apple will continue to develop its own 5G chips.” But it won’t have anything ready in time for the 2023 iPhone.
[Company Update] Qualcomm (QCOM.O)
My latest survey indicates that Apple's own iPhone 5G modem chip development may have failed, so Qualcomm will remain exclusive supplier for 5G chips of 2H23 new iPhones, with a 100% supply share (vs. company's previous estimate of 20%).
— 郭明錤 (Ming-Chi Kuo) (@mingchikuo) June 28, 2022
Apple sank loads of money into this effort
Apple has been working to replace Qualcomm modems with its own, designed entirely in-house, for several years now. While it’s never officially announced this plan, Cupertino acquired Intel’s mobile modem business for $1 billion in 2019 to kick-start that mission.
Several months ago, word leaked out that Apple would be ready to put its own 5G modem in the 2023 iPhone 15. The actual manufacture would be done by TSMC, which also makes CPUs for iPhone, Mac and iPad. But if Kuo is correct, that’s not going to happen in 2023.
There’s always been a certain amount of risk in Apple’s effort to products its own modems. It doesn’t want to get rid of Qualcomm’s for technical reasons, but for business reasons. (And maybe spite.) Qualcomm makes the highest quality modems available, and it won’t be easy for Apple to produce ones equally fast, reliable and energy efficient.