Friday, Nov 04, 2022, 15:17 Economy

Qualcomm Confirms Apple's Failed Modem Development

Many reports that arrive months before the presentation of next-gen hardware are all based on information from suppliers. Either a leak took place during a confidential process, or – as is often also the case, more exact estimations can be made simply by analyzing business reports. Given that Apple's partners are frequently listed companies, the impacts of Apple's decisions on these companies quarterly and annual statements reveal a great deal. Should Apple be one of its partners' primary customers, each new hardware generation will signal a massive increase of orders for components – which provides market experts with the opportunity to make deductions about the future.

Investors' Report Passage Speaks Volumes
Qualcomm has now confirmed, that Apple will be unable to equip its iPhones with in-house modems. Although there isn't any such official statement, there's another more than clear indication. Qualcomm's investor report confirmed that the company would maintain it's "current position" with regard to Apple. This statement is actually quite an important one for the company, given that Qualcomm's previous annual report was much less optimistic. This spring, word was that Qualcomm was only expected to contribute to 20% of Apple's future iPhones as opposed to 100%. However, this report now confirms a previous one from June, indicating that Apple may not be able to fully realize it's in-house modem plans as quickly as expected – meaning continued reliance on Qualcomm for its cellular modems.



Qualcomm Patents Obstruct Apple Modem Development
In June, market expert and analyst Ming-Chi Kuo reported that Apple's modem development was standing on thin ice. This doesn't necessarily mean the entire end of the project, but perhaps a significant delay. Next to the enormous technical complexity, there were also even more decisive legal reasons for the project's current status. The Supreme Court refused a second hearing request from Apple concerning the invalidation of two essential Qualcomm patents. Exactly these made it very difficult for Apple to continue its modem development without incurring high licensing fees. Thus, Qualcomm had the better hand throughout its negotiations with Apple, and it's simpler for Cupertino to continue as the chip manufacturer's customer.

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