Reports indicate that Apple is planning to use baseband chips made by Intel exclusively for the iPhones that will be released this year. According to KGI Securities the chips from Intel not only meet Apple’s technical requirements but are also more competitively priced. At the moment Apple gets its chips from Intel and Qualcomm though the iPhone maker is engaged in a legal feud with the latter.
Three months ago KGI Securities had indicated that the Cupertino, California-based tech giant had been planning on sourcing 30% of its chips from Qualcomm. Now the report from the investment firm indicates that Qualcomm has been shut out by Apple completely.
However the two may still be in a position to work together in future in the event that they settle their differences. Part of the reason for this is that baseband chips from Intel may not be 5G-ready leaving Apple with no choice but to use Qualcomm’s chips. Benchmark studies done in the recent past have also indicated that Qualcomm’s baseband chips have a superior performance compared to Intel’s.
The dispute between Apple and Qualcomm has previously led to speculation that the iPhone maker would ditch the leading chipmaker. Last year in October the Wall Street Journal claimed that Apple was considering other suppliers of chips due to the legal wrangles it had with Qualcomm. At the time the Journal alleged that Apple was considering Taiwanese supplier MediaTek besides Intel.
Poor iPhone sales
The report comes in the wake of Wall Street firm Morgan Stanley claiming that the poor sales of iPhones that Apple recently reported coupled with an increase in the inventory levels would hurt suppliers of chips.
“Disappointing iPhone units combined with an inventory overbuild should continue to have a pronounced impact on Apple suppliers and the smartphone segment more broadly,” a semiconductor analyst at Morgan Stanley, Joseph Moore, wrote in a client note.
At the same time Apple and Cisco have teamed up to provide insurance policies to firms that use their products in order to offer them financial protection against cyber-attacks. Besides the insurance policies the partnership will see clients provided with corporate security reviews.
Aon, a professional services firm, will conduct security consulting for firms while Allianz, an insurance firm, will offer insurance coverage at discounted rates on condition that clients use certain security products from Cisco and particular devices made by Apple. The move is part of Apple’s strategy to increasingly target business customers.