Hear that, Qualcomm? Analyst claims Apple's homegrown 5G modems to land in 2023 'at the earliest'

Securities advisor passes note setting potential date for snipping of Snapdragons to investors


Nearly two years after Apple swallowed Chipzilla’s smartphone modem business for a cool $1bn, the company is reportedly set to start using its own home-grown baseband chips, starting with 2023’s iPhone.

The report comes from Ming-Chi Kuo, an analyst at TF International Securities with a solid track record of gaining accurate inside information about Apple’s product movements. According to AppleTrack, Ming-Chi's tips have a 76.6 per cent accuracy rate.

In an investor's note, Ming-Chi wrote he expected the iPhone will start using modems designed in-house by “2023 at the earliest.” This echoed similar predictions expressed by analysts at Barclays.

This shift, he added, might prove damaging to Qualcomm, which provided the Snapdragon X55 modem used across the iPhone 12 series. The company is also expected to provide its Snapdragon X60 modems for the upcoming iPhone 13, and previously supplied baseband chips for devices sold through CDMA carriers (namely Sprint and Verizon).

That said, the terms of the deal inked by Apple and Qualcomm back in April 2019, settling all litigation between them, was widely said to be favourable to Qualcomm.

Ming-Chi claimed that sales of high-end 5G Android devices had proven “sluggish,” and would force Qualy to increase its presence in the low-to-mid end segments, where arch-rival MediaTek is a formidable foe.

As noted in Qualcomm’s latest financials, sales of baseband chips are a neat money spinner for the company, accounting for $903m in revenue during the last quarter, up 39 per cent year-on-year. Cristiano Amon, Qualcomm’s president and soon-to-be CEO, expects sales of RF front-end components to hit $3.6bn by the end of the year.

Earlier this year, Apple announced plans to develop a €1bn semiconductor research facility in Munich, with a heavy focus on wireless technologies. With an opening date penned for late 2022, the campus will consolidate Apple’s existing semiconductor R&D teams in the region. The former Intel modem team itself orginated from German outfit Infineon.

There’s also the matter of the $600m IP and asset transfer deal with Dialog Semiconductor, which added four teams of R&D workers to Apple’s payroll, including two in the Bavarian town of Neuaubing, which sits on Munich’s periphery.

By producing its own modems in-house, Apple would gain the ability to tightly integrate its RF chippery with its Apple Silicon line of processors, and focus on areas that the company deems important, such as power management. ®

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