
Apple's Modem Ambitions: Aiming to Surpass Qualcomm by 2027 | Image Source: www.bloomberg.com
CUPERTINO, California, December 14, 2024 – Apple Inc. is expected to unveil its long-awaited internal cell modeling technology next spring, marking an important step towards reducing its dependence on Qualcomm Inc. According to Bloomberg, the technology will be launched in the next update of the iPhone SE, Apple’s entry smartphone. This movement comes after years of intensive development and underscores Apple’s ambition to establish a dominant position in the cell modem market by 2027.
Apple has been working on its modem technology for more than half a decade. The shift to an internal solution aims to give the company better control over the integration of hardware and software, as well as to reduce the dependency of Qualcomm, with whom Apple had a turbulent relationship. As Bloomberg said, the next Apple modem system will initially focus on 5G connectivity and will have a significant presence on the iPhone SE, which will be launched next year. This version marks Apple’s first important step towards replacing Qualcomm components with its product range.
Out of Qualcomm
For years, Qualcomm has been Apple’s leading provider of modem technology, providing essential components for cellular connectivity. However, the two companies have a contentious case, marked by legal disputes over patent royalties and technological licences. Despite its differences in 2019 with a multi-year agreement, Apple continued to invest in building its own modem capabilities, acquiring Intel’s smartphone modem business for $1 billion in 2019. According to Bloomberg, the beginnings of the Apple modem indicate the company’s determination to establish links with Qualcomm in the coming years.
Apple’s roadmap includes an incremental deployment strategy, starting with its input devices before accessing high-end products such as the iPhone Pro line. According to industry experts cited by Bloomberg, this approach allows Apple to test and refine its modem technology in low-consumer products before integrating it into iconic devices. In 2027, Apple aims to move away completely from Qualcomm technology, saving billions of dollars in component costs.
Challenges in the development of modern technologies
The development of cellular modems is a complex and resource-intensive effort that requires wireless standards, network interoperability and energy efficiency. According to Bloomberg, Apple’s efforts have identified several obstacles, including performance problems and delays in meeting carrier certification requirements. Modems should not only be reliably connected to cellular networks around the world, but also be effectively connected to preserve battery life, a critical factor for mobile devices.
Apple’s decision to integrate modem into its own silicon architecture underscores its confidence in achieving these goals. This strategy is part of the broader philosophy of vertical integration of the company, which has already succeeded with its A and M series processors. By designing its own modems, Apple can ensure closer integration with its hardware and software ecosystem, which could deliver better performance and energy efficiency than third-party solutions.
Impact on the smartphone market
The introduction of Apple modem chips could have important implications for the smartphone industry. Qualcomm, which currently provides modem technology to a wide range of device manufacturers, means losing one of its largest customers. According to Bloomberg, Qualcomm is expected to provide only a fraction of Apple’s modems by 2026, indicating a gradual shift in market dynamics.
Apple’s entry into modem space could also leverage other smartphone manufacturers to explore internal solutions or alternative suppliers. In addition, Apple’s success could set a precedent for other technology companies to invest in the development of patented cellular technologies. Analysts suggest that Apple’s movement could lead to greater competition and innovation in the modem market, ultimately for consumers through better connectivity and potentially lower costs.
The Way Forward: Seeking Market Leadership
Apple’s ultimate goal is not only to assimilate Qualcomm’s capabilities but to overcome them. As Bloomberg said, the company expects its modems to become industry leaders by 2027, offering superior performance, efficiency and integration. To achieve this ambitious goal, Apple will have to overcome significant technical and regulatory challenges and partner with operators around the world to ensure the smooth adoption of its technology.
The implementation of Apple modem technology is likely to follow a progressive approach. After starting on the iPhone SE next spring, later iterations are expected to extend to other product lines, including iPads and MacBooks. By taking advantage of its ecosystem, Apple can create unique features and experiences that differentiate its devices from its competitors, thereby strengthening its market position.
According to Bloomberg, this strategic change reflects Apple’s long-term vision of self-sufficiency and innovation. While the company’s relationship with Qualcomm has been mutually beneficial in the past, Apple’s commitment to autonomy underscores its commitment to controlling key technologies that define its products.
As the technology giant prepares to reveal its first internal modem next year, the industry will look closely at Apple navigating this transformation period. The movement not only highlights the company’s technological feat, but also indicates a new chapter in the continued evolution of the smartphone market.