
Apple to Replace Third-Party Bluetooth and Wi-Fi Chips with In-House Design | Image Source: www.cnet.com
Cupertino, California, December 14, 2024 – According to ​reports, Apple is taking an important step towards ​reducing its dependence on external suppliers by phasing ​out existing Bluetooth and Wi-Fi chips in favour of a ​custom-made alternative. According to a Bloomberg report on Thursday, the new chip, ​called Proxima code, has been ​in development for several years and is expected to ​start in 2025. ​This ​movement marks ​another step in Apple’s ​mission to ​extend its control over hardware components and strengthen its ecosystem.
According to Bloomberg, Apple’s Proxima chip will ​initially power ​iPhones and smart devices for home, replacing chips currently provided by Broadcom. ​This ​change highlights Apple’s ​commitment to internal innovation, based on its design history of patented components such as M-series chips ​for Mams. Apple’s decision to bring home flea ​design reflects its broader strategy to optimize performance, improve product integration ​and support advanced features such as artificial intelligence (AI).
Transition to ​custom chips
Apple’s strategy to ​design its own Bluetooth and Wi-Fi chips is ​aligned ​with its ​broader ambition to vertically integrate its technological battery. The ​new chip should improve efficiency, reduce latency and better integrate with other Apple hardware. According to Bloomberg’s report, the Proxima chip is likely to be a fundamental element in enabling advanced features, including those powered by AI. This transition will also reduce Apple’s ​reliance on external suppliers such as Broadcom, which will allow the technology giant to ​better control its ​supply chain ​and reduce its long-term costs.
Apple has made similar moves in ​the ​past, such ​as ​the introduction of its M-series processors for Mac ​computers, which replaced Intel chips. The success of these chips not only increased the performance and energy efficiency ​of Apple devices, but also enabled the company to adapt hardware and software to work perfectly together. The Proxima ​chip is expected to follow this trend, possibly establishing a new benchmark ​for connectivity standards in consumer ​electronics.
Consequences for third-party suppliers
Broadcom, which currently provides Bluetooth and Wi-Fi chips to Apple, could face significant financial implications ​of this ​change. Apple’s departure as a customer would likely ​affect ​Broadcom’s revenues, given the significant portion of its business attributed to the provision of components for Apple products. In the past, Apple has accounted for a significant share of ​Broadcom’s ​revenue flows. Although Broadcom has not yet commented on the ​report, ​industry analysts suggest that the company may need to diversify ​its clientele to mitigate the impact ​of losing one of its largest customers.
Similarly, Apple is also working on its own cell modem chips, which ​should ​start in 2025. This development could reduce the company’s dependence ​on ​Qualcomm, which ​currently provides 5G modems for iPhones. Apple’s growing ​self-sufficiency in component manufacturing indicates a transformative ​shift in the technology industry as key ​players move towards greater autonomy over their ​supply chains.
Production in India
In a separate development, Apple would have planned to start manufacturing AirPods in ​India by ​early 2025. According to Bloomberg, the movement is part of Apple’s efforts to diversify its production base away from China in the midst of geopolitical tensions ​and ​supply chain vulnerabilities. Last year, Foxconn, Apple’s leading manufacturing partner, ​invested ​$200 million to build a new facility in India specifically to produce AirPods. ​This initiative highlights Apple’s approach to reducing the risks associated ​with ​a country’s ​excessive dependence on manufacturing.
Apple’s pivotal to India ​is aligned with its broader strategy to expand operations in ​emerging ​markets. ​The company has already increased iPhone production in India and recently opened its ​first retail stores in the country. By producing AirPods in India, Apple ​aims to strengthen its presence in ​one of ​the fastest smartphone and electronics markets in ​the world, while addressing the ​challenges of the global supply chain.
Apple’s commitment to innovation
The ​Maxima chip ​is a commitment to Apple’s ​commitment to innovation and its search for end-to-end control over its product ecosystem. By designing patented components, Apple can ensure a ​closer integration between hardware and software, allowing ​for a more perfect user experience. In addition, custom-designed chips could pave ​the way for improved AI capabilities and ​improved energy efficiency, allowing Apple to retain its ​competitive advantage in the rapidly changing technological landscape.
This movement ​also allows Apple to better manage its environmental impact. Internally designed custom components can be optimized for longevity and durability, in line with Apple’s broader goals to ​achieve carbon neutrality in its supply chain by 2030. As the company continues to invest in innovation, these initiatives highlight its leadership role in shaping the future ​of consumer technology.
From now on, Apple has not provided any official comments on the Proxima ​chip or its future manufacturing plans. However, reports suggest ​that the company is configured to reveal these ​changes in the near future, possibly from its 2025 product range. If successful, the Proxima chip could serve ​as a ​game changer ​for Apple, further strengthening its ​field in the technology industry.