Why Your next iPhone could come with Intel inside?

It’s not been easy for Intel to catch up with the big hitter Qualcomm in the mobile chip market but there’s some light at the end of the tunnel, if a Bloomberg report is to be believed – apparently Intel’s modems will be used in the iPhone 7 for phones sold on AT&T in the US and some international versions.

Qualcomm, the current incumbent, will pick up the slack on Verizon and in other parts of the world, particularly China. While it’s not great news for Qualcomm, the company won’t be panicking yet, and the move was to some extent expected: we heard very similar rumours last October.

Note that we’re talking modem chips here, which connect your smartphone to a cellular network and control radio communications – we’re not referring to the processors in the new iPhones, a job Apple usually farms out to TSMC and Samsung. It’s possible Intel could eventually take over here, too.

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Partnering up

While you probably won’t give much thought to who made the modem chip as you amble down to the Apple Store to pick up your iPhone 7, it shows signs of hope for Intel in the smartphone market and indicates that Apple is willing to diversify in choosing hardware partners to help build its flagship handsets.

Further down the line it could lead to cheaper iPhones if Apple manages to play manufacturers off each other in terms of price. It’s estimated that Qualcomm gets around $15 for every iPhone Apple sells – about $3.47 billion last year, then.

As for the really juicy iPhone 7 rumours, there are plenty of those too. The handset, due in September, is said to be adding a camera lens, dropping the headphone jack, adding waterproofing and dropping the bezels. Aside from that, expect something that looks very similar to the iPhone 6S.


The Intel advantage

The A9 chips inside Apple’s flagship iPhone 6S and iPhone 6S Plus smartphones are manufactured by TSMC and Samsung. Even though the A9 chip is a 14nm processor, Apple’s partners create the interface with a 20nm design, which isn’t as efficient or advanced as Intel’s 14nm design.

In addition to a 14nm design, Intel has begun work for an even smaller 10nm design, which could be ready in as little as two years. This puts Intel’s timeline ready for production for an A-series processor for the iPhone 8, with the iPhone 7S likely succeeding next year’s iPhone 7.

Intel reversed earlier declines and rose as much as 0.7 percent, to $32.15. The shares declined 7.3 percent this year through Thursday. Qualcomm fell as much as 2.9 percent to $53.40. It had been up 10 percent so far this year.

Intel’s history with Apple

Infineon, the wireless company that Intel acquired, had supplied 3G modems for Apple’s iPhone until 2011. Apple has since switched to Qualcomm as its modem supplier.

Since the acquisition, Apple has hired a number of top Infineon executives, including Intel CTO Bernd Adler. VentureBeat cites conflicting sources as to the reason for Apple’s hire. Some speculate that Apple hired Infineon engineers to help collaborate with Intel, while others suggest that Apple wants to design its modem in-house, similar to how it currently designs the A-series processors.

In addition to mobile, Intel’s processors are also found on Apple’s OS X products. Apple transitioned from a PowerPC architecture to Intel’s x86 processor in 2006. Now, Intel processors span all of Apple’s desktops and laptops, including the Mac Pro, Mac Mini, iMac,MacBook, MacBook Air and MacBook Pro lines.

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