Apple can't make its own 5G modem for the iPhone and will continue to buy them from Qualcomm for at least three more years
Qualcomm will continue to supply Apple with 5G modems for smartphones. The companies have extended the agreement, which was set to expire in 2023.
Here's What We Know
Apple started working on its own 5G modem five years ago. To do so, it spent $1bn to buy part of Intel's business. Two years ago, the Cupertino-based company negotiated with TSMC to launch production of 5G modems for the iPhone.
The agreement with Qualcomm is for three years. At the same time, the patent licensing agreement is still in force. It expires in 2025, but Apple and Qualcomm can extend it until 2027.
The fact that Apple will be buying 5G modems until 2026 hints at problems with developing its own solution. Nevertheless, Bloomberg analyst Mark Gurman does not rule out the announcement of a new Apple chip within three years.
Meanwhile, the Cupertino-based company is Qualcomm's largest customer. Apple accounts for 22.3 per cent of the US chipmaker's total sales. The top three are Samsung (17.5%) and Xiaomi (8.6%).
