Apple finally enabled 5G support on its iPhones last year with the release of the iPhone 12 lineup. This leap in connectivity was powered with Qualcomm‘s 5G modems. Qualcomm is the leading 5G modem manufacturer/supplier in the smartphone world and has an almost monopolistic hold over the market share. However, this is about to change in a big way soon.
Apple x TSMC
In a new report from NIKKEIAsia, it has come to light that Apple is switching to its own modem design for 2023 iPhones, ditching Qualcomm in the process. According to the leak, Apple will task TSMC to manufacture the modems. Considering the two companies’ close history, it’s no surprise Apple choose TSMC for the fabrication. TSMC is the sole producer of Apple’s A-series Bionic iPhone SoCs along with the new M1 SoC. TSMC also happens to be the biggest semiconductor contract manufacture in the world.
The modems will be built on TSMC‘s N4 (4nm) process node but test units will be first made on the 5nm node next year. After the initial tests, the modem will be moved to the more advanced 4nm process and mass-produced in time for iPhone 15‘s release. TSMC is also tapped to make 3nm chips for some iPad models next year and for 2023 iPhones afterwards.
Why in-house modems?
This shift in modem tech will be exceedingly beneficial for Apple as it will further fortify Apple’s vertical integration strategy and allow Apple to be in control of yet another hardware component. Using its own modem will enable Apple to increase its efficiency and potentially improve the overall quality of data transmission through the modem.
Apple vs Qualcomm
But the primary reason for the switch here is to escape reliance. Apple is currently dependent on Qualcomm for its 5G modems and it wants to cut off those ties as soon as possible. Apple does not like to rely on any third-party manufacturer wherever it can become its own supplier, however it’s even more personal with Qualcomm. Apple and Qualcomm go back several years and have generally never had great relations with each other.
Apple has used both Intel and Qualcomm‘s modems for the longest time in its iPhones but since 2017, it couldn’t use Qualcomm’s modems anymore due to patent licensing conflicts and other accusations. Real-world performance has always indicated that Intel’s smartphone modems have generally lagged behind Qualcomm’s but Apple hasn’t taken advantage of that extra performance in the first place. Nonetheless, due to the ongoing case between Apple and Qualcomm, Apple couldn’t use Qualcomm’s modems which meant that the upcoming iPhone could not use a 5G modem, and Apple didn’t want to compromise and go with Intel’s lackluster 5G modem. So, no 5G for the iPhone 11 where every other flagship on the market had 5G support.
After a lengthy legal battle, Apple ended up settling the case with Qualcomm (with hefty “sorry money“) so that it could finally use its 5G modems inside iPhone 12 and, now, iPhone 13. Some time later, Apple also acquired Intel’s smartphone modem division in 2019 after the settlement with Qualcomm. This acquisition came as a result of Apple losing the legal battle against Qualcomm. Regardless, this meant that Apple could finally develop its own modems but for the next two years it still worked with Qualcomm to source 5G modems That’s because making networking modems is quite difficult and very different from microprocessors so Apple needed time to ensure utmost quality.
The last laugh
That being said, if today’s report is true then it looks like Apple is finally ready. The Intel modem acquisition along with over 2 years of development has likely lent Apple enough time and resources to switch to its own in-house modem design in the near future. NIKKEIAsia also mentions that hundreds of engineers from TSMC are stationed at Cupertino, California to bolster Apple’s modem development efforts, which would certainly help in quickening this process.
With this switch, Qualcomm’s share of iPhone modem orders will drop to just 20% in 2023, something that the company itself has said. Apple will now have ultimate control over even more of the iPhone and the change would surely constitute improvements in 5G connectivity for the iPhone 15 lineup. Interestingly, this seems like the second blow to Qualcomm we’ve seen in recent memory with first Google leaving Qualcomm for its own in-house Tensor chip, and now Apple ditching the company to develop its own 5G modems. Although, this change won’t hurt Qualcomm nearly as much anyways.