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Apple (AAPL) Slowly But Steadily Moving Towards Strategy Of Making Own Modem Chips For Its Products

Instead of purchasing them from chip providers like Intel Corporation (INTC) and Qualcomm Incorporated (QCOM); Apple Inc (AAPL) is patiently following its policy of creating in-house processors that power its devices (iPhones, iPads, MacBooks, etc.)

The iPhones and iPads of the Apple are already fitted with homemade processors and some of the latest MacBook laptops have also been equipped since last November.

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Apple is now creating its own 5G chip modem for its iPhones, iPads, and other devices, according to sources cited by Bloomberg on Friday. This will allow the U.S. mobile giant to reduce its reliance on its supplier Qualcomm, which has fitted 5G modems to its new iPhone 12 models. The modem is the part that enables internet networks to be connected by a computer.

Bloomberg noted that Johny Srouji, Apple’s vice president of hardware technology, at a meeting between executives and employees said that the California-based company was working on a home-made modem. The official referred to the launch of the first internal cellular modem development that will enable another key strategic transition.

As Apple purchased Intel’s mobile modems division last year with a view to producing its own modems, such a move would not really be a surprise.

Johny Srouji did not say when the first iPhone equipped with an Apple modem will be manufactured, but according to the press, this could begin to happen sometime in 2022, even though the agreement signed in 2019 with Qualcomm promises the latter to supply Apple with network chips at least until 2023.

By using its own M1 processor for its new MacBooks including MacBook Air, MacBook Pro and Mac mini, released in November, Apple also started to reduce its reliance on suppliers. However it should be noted that during a transitional period, Intel will continue to supply processors for other MacBooks, even though the Cupertino company plans to equip all its laptops with its own processors.

On Wall Street, the stock of Qualcomm Incorporated (QCOM) replied on Friday by dropping 7.3 percent after the report to conclude trading at $144.28, while the stock of Apple Inc (AAPL) dropped by 0.67 percent more modestly in a broadly bearish market on the day to settle at $122.41.

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