Netease Technologies News, Jan. 12, Reuters reported that in the Federal Trade Commission (FTC) v. Qualcomm monopoly case, Apple executives testified that the company had negotiated with Samsung and MediaCorp to provide a 5G modem for the 2019 model of the iPhone with existing supplier Intel.
Between 2011 and 2016, Apple relied on Qualcomm as the sole supplier of such chips to help the iPhone connect to wireless networks. Since 2016, Apple has split the contract between Intel and Qualcomm. But in 2018, Apple handed over the contract for the latest modem chip to Intel.
But Tony Blevins, head of Apples supply chain, testified that Apple was also considering supplying chips for the next generation of 5G wireless networks to MediaTek and Samsung, the biggest competitors in Apples smartphone market. These networks are expected to start operating this year, providing faster data transmission speed than current 4G networks.
FTC is suing Qualcomm for anti-competitive patent licensing activities to maintain its dominance in the high-end modern chip market.
In testimony before a federal court in San Jose, California, Blevins said Apple had been looking for suppliers of modem chips, but the company signed an agreement with Qualcomm to supply modem chips exclusively because Qualcomm offered high rebates on patent licensing costs.
In 2013, Apple interrupted its collaboration with Intel, which no longer provides a modem for the iPad Mini2, because if Intel chips were used, Apple would lose its kickbacks and Intels products were generally economically unattractive.
Blavins confirmed that later that year, after failing to achieve satisfactory results in cost negotiations with Qualcomm, Apple launched Project Antique to ensure that it had a second modem supplier.
By 2016 and 2017, Apple had introduced Intel modems into some of its iPhones, but still used Qualcomm chips. However, Apple filed a lawsuit against Qualcomm in early 2017, which led to a change in the business relationship between the two companies in a very profound and negative way, prompting Apple to only use Intels modem in its mobile phones released last year.
The whole idea of Project Antique is to find a second supplier, Blevins said. We dont want to offend (Intel), but we dont want them to be a single supplier, and we want Qualcomm and Intel to be involved. Blevins also testified that Apple had considered Intel as the sole supplier of Apple Watch modems. AppleWatch added 4G connectivity using Qualcomm chips in 2017.
Samsungs Galaxy and Note devices compete fiercely with the iPhone and negotiating with Samsung is not an ideal choice for Apple, but Samsung is currently Apples largest supplier of components, Blevins said.
Blavins did not say whether Apple had identified a 5G modem supplier or whether Apple would launch 5GiPhone in 2019. Bloomberg previously quoted sources as saying that Apple would not release the phone until 2020. (small)
Source: Responsible Editor of Netease Science and Technology Report: Wang Fengzhi_NT2541