Apple has decided to tap Intel as a supplier for modem chips for the next iPhone, a move that can be considered a big win for Intel.
The Intel modem chips will be replacing ones manufactured by Qualcomm, Bloomberg reported. However, not all Qualcomm modem chips are being replaced by Intel ones across all versions of the next iPhone.
According to Bloomberg's sources, Apple will be using Intel modem chips for AT&T versions of the next iPhone, along with some versions for overseas markets. For Verizon versions, Apple will stick with Qualcomm as the supplier for the component, along with models that will be sold in China.
The sources looked to remain anonymous due to the plans not yet publicized by Apple. Representatives for the companies involved in the matter refused to issue comments.
If the report is true, this will not be the first time that a flagship smartphone will have different components in models across different regions. Samsung's Galaxy S7, for example, is powered by the Qualcomm Snapdragon 820 processor in the United States, but for models in Asia and Europe, the device packs Samsung's proprietary Exynos chipset.
The decision to tap Intel as another supplier of modem chips could be for diversification on the end of Apple. Having multiple suppliers will prevent Apple from finding itself in a position of being powerless in case a supplier decides to increase prices or falls short from providing components.
Intel could also have promised Apple discounts on the modem chips, with the company looking to finally enter the iPhone game after ceding supplier status for the iconic smartphone to other manufacturers.
With Apple working with both Intel and Qualcomm for modem chips, the company will be able to switch to using 5G technology as soon as either company is able to deliver the necessary components.
The iPhone 7 will be the first major flagship smartphone that will be featuring an Intel wireless chip, and it could not have come at a better time to rejuvenate Intel's business. The company has been struggling, with operating losses being incurred, and the order from Apple would give it a shot in the arm that it really needed.
The company said last month that it was dropping its Atom processors for mobile devices as part of its restructuring. While it has dropped its business for creating processors for smartphones, it has kept its modem chip business as it looks to be part of the near-future transition into 5G networks.