Bloomberg has reported, from an anonymous source, that Apple will be switching to Intel Corp for their LTE chips over the existing Qualcomm Inc. chips that are currently used. The shift will take place for some models of the upcoming iPhone 7.
While Apple will continue to source chips from Qualcomm Inc. for its iPhones on the Verizon network in the USA, it will also continue with the same chips for phones that will be used across China. The Intel chips will be used in iPhones that will run on the AT&T network in the USA, as well as in some devices that will be sold overseas.
This will be the first win for Intel’s wireless division from one of the world’s most significant smartphone manufacturers.
Back in 2007, these modem chips were provided to Apple by Infineon Technologies AG for the very first iPhone. Intel took over Infineon Technologies shortly after, and they lost the Apple contract to Qualcomm Inc. on account of them being able to provide modem chips with a higher data conversion capability.
An analyst from BTIG LLC states that Verizon is expected to sell 21 million iPhones in 2016 and 22 million the following year. AT&T, on the other hand, will sell 22 million iPhone units this year and 23 million in 2017. These are expected to contribute to Intel’s losses that incurred ever since the reinstatement of their wireless division.
Qualcomm made $3.47B in 2015 from Apple iPhone sales
Qualcomm currently enjoys $15 per iPhone for their hardware contribution, which amounts to a figure of $3.47billion, as Apple sold around 231 million iPhone units in 2015.
When compared, Qualcomm’s modem chips still out-beat Intel’s counterparts to data conversion rates.
Earlier in April, Qualcomm’s Chief Executive Officer, Steve Mollenkopf, stated that one of their customers would shift to multiple suppliers, but the company’s business performance would continue to improve in the second half of the year regardless of that particular development.