WSJ: Apple in ‘advanced talks’ to acquire Intel’s smartphone modem business for $1 billion

Apple is reportedly in “advanced talks” to acquire Intel’s smartphone modem business. According to The Wall Street Journal, Apple would pay at least $1 billion for Intel’s patents and staff.

The deal could be reached within the next week, according according to the report. It’s possible, however, that talks could still fall apart. The report details that Apple and Intel were in talks prior to Apple’s settlement with Qualcomm, but that negotiations broke down following that deal. Intel reportedly then briefly opened the offer up to other companies, but eventually resumed talks with Apple as it was seen as the “most logical buyer.”

Following Apple’s settlement with Qualcomm, Intel announced that it was exiting the 5G smartphone modem business. The company said it did not see a path to profitability in the business, and instead wanted to focus on its more profitable data infrastructure business.

Apple is in the process of developing its own modem technology, which would allow it to rely less heavily on companies like Qualcomm. Analysts have predicted that Apple will use 5G modems from Qualcomm and Samsung in 2020.

The report explains the reasoning behind Apple acquiring Intel, saying it would save the iPhone maker “years of development work.”

It would give Apple access to engineering work and talent behind Intel’s yearslong push to develop modem chips for the crucial next generation of wireless technology known as 5G, potentially saving years of development work. Apple has been working to develop chips to further differentiate its devices as smartphone sales plateau globally, squeezing the iPhone business that has long underpinned its profits.

It has hired engineers, including some from Intel, and announced plans for an office of 1,200 employees in San Diego.

Read the full report from The Wall Street Journal here.

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