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Apple Continues Talks With Intel Over Modem Acquisition: Report

Apple may be looking to have more control over its iPhone development and launches by bringing modem development in-house.

The question of whether Apple still wants part of Intel's modem business may have been answered, with a report that Apple is discussing the acquisition of Intel's modem division in Germany.

Beginning last summer—and ending "around the time" of Apple's supply agreement with Qualcomm in April—Apple held talks about acquiring part of the smartphone modem business from Intel, the Wall Street Journal reported previously.

[Related: Apple Payment To Qualcomm May Have Reached $4.7B]

However, that report suggested Intel might still seek to sell its modem chip business to Apple. And, an industry analyst previously told CRN, Apple would likely be interested in a mobile modem deal with Intel even with its new agreement with Qualcomm.

Now, a report in The Information said that Intel is considering "selling its struggling modem business in pieces," with the German modem operations potentially going to Apple.

Intel's modem division is centered in Germany, and an acquisition of the unit by Apple could bring several hundred modem engineers to the company, The Information reported. In 2011, Intel completed its $1.4 billion acquisition of the wireless solutions business from German semiconductor firm Infineon.

In a statement provided to CRN, Intel said, “We have hired outside advisors to help us assess strategic options for our wireless 5G phone business.”

“We have created value both in our portfolio of wireless modem products and in our intellectual property,” Intel said in the statement. “We have received significant interest in the business but have nothing more to say at this time.”

Apple did not immediately respond to a request for comment.

Apple has a lengthy history of chip design, and "having more and more components under their own roof would make them more in charge of their own design destiny, timing and launches," one solution provider partner of Apple, who asked to not be identified, told CRN previously.

While Apple and Qualcomm were locked in their legal dispute, Apple began exclusively using Intel's cellular modems starting with the 2018 iPhone lineup.

"I believe that ultimately, Apple wants to develop its own modems to reduce its reliance on other companies, integrate into other devices and theoretically lower costs," said Patrick Moorhead, president and principal analyst at Moor Insights and Strategy, in a previous email to CRN.

Apple recently paid as much as $4.7 billion to Qualcomm as part of ending litigation and resuming business between the two companies. The deal has Apple and Qualcomm entering a six-year patent license agreement as well as a multi-year chipset supply agreement.

The disclosure of the deal in April prompted Intel to announce plans to pull out of the 5G modem business.

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