11/06 Update below. This post was originally published on November 3.
The iPhone 15 updates with the best recommendations are falling like fliesand now one of the biggest looks is sure to miss the cut.
Apple’s much-hyped in-house 5G modem will no longer debut with the launch of the iPhone 15 range in 2023, signaling a major setback for Apple’s modem division. The news followed comments from Apple’s modem supplier Qualcomm in its earnings report yesterday.
picked up by BloombergQualcomm told investors it will continue to supply the “vast majority” of modem chips for Apple’s iPhone 15 range in 2023. The company said it previously expected to supply only 20% of iPhone 5G modems by this time, given Apple’s demand. ambitious roadmap for your own 5G modems.
Nov 4 update: I can now confirm Qualcomm’s comments reported by Bloomberg, which in turn confirm that Apple’s modem ambitions are delayed for at least another generation of iPhone.
11/05 Update: The same source has now added more details to Qualcomm’s comments, stating that the company expects to continue supplying Apple with modems for iPhone models for at least the next three generations.
The source also says that Qualcomm doesn’t expect Apple to replace Qualcomm’s modems all at once, but rather to deploy them at increasing percentages with each successive iPhone generation. It makes perfect sense. The company has also tried this model before.
Apple was already looking to diversify its modem providers when it began integrating Intel modems into iPhones with iPhone 11. performance issues cut the experiment short, but Apple was motivated enough to buy Intel’s smartphone modem division in 2019 to test the chips.
Since then, the lack of a commercial product has shown that competing with Qualcomm is no easy task. That said, the potential gain for Apple is twofold. First, you gain more control of your supply chain. Second, you can integrate internal modems earlier in the design process, which could unlock higher performance and battery efficiency.
As such, while it was delayed, I don’t see Apple abandoning its modem ambitions any time soon.
11/06 Update: Following his initial report, Bloomberg’s Mark Gurman added more detail to Qualcomm’s claims that it will continue to supply the “vast majority” of iPhone 5G modems in 2023. Going a step further, Gurman explains:
“Qualcomm now believes it will supply most of Apple’s modems in 2023. In fact, the company has hinted that it might as late as 2025. That means Qualcomm will continue to get a strong revenue stream from Apple’s large iPhone volumes. It also suggests that Apple’s internal initiative is lagging behind.”
This jump to three years is related to the information provided yesterday by my source. It’s also important to note that “until 2025” doesn’t mean that Apple will replace Qualcomm at that point. Rather, by 2025, Apple may be in a position to deliver a significant proportion, potentially the majority, of iPhone modems by 2025, but Qualcomm will still be heavily involved.
By extension, 2026 now appears to be the earliest we can expect iPhone modems to be produced entirely in-house and the benefits of that integration to be felt. After all, even if Apple can deliver big profits sooner, the company can’t ship iPhones with different levels of performance. after the 2016 debacleso Apple’s modems will be tethered.
It goes without saying that timelines can change quickly when looking ahead. That said, I can’t cite a previous example of Apple making such a major acquisition and having to wait that long to bring the product to market.
As it stands, the 2019 purchase of Intel’s modem division won’t bear fruit for another 6-7 years. I’m sure that’s not what Apple expected at the time.
Despite working on the chip since 2020, Bloomberg reveals that Apple has suffered major setbacks, causing the delay. In July, it reported that the prototypes had “overheated over the last year.”
Respected industry analyst Ming-Chi Kuo went even further, saying that the development of the modem “may have failed”, claiming that Apple may be forced to rely on Qualcomm for the foreseeable future. Last month, Haitong International Securities analyst Jeff Pu agreed, saying Apple’s modem could miss iPhone launches in 2023 and 2024.
But this is the first time we’ve heard from an Apple partner, and Qualcomm’s announcement adds considerable weight to these pessimistic projections. Such a delay would have seemed unthinkable when Apple bought Intel’s 5G modem business for $1BN in 2019. Intel was already shipping modems for smartphones, and Apple used them in the iPhone 11 range.
As such, it is difficult to understand why the project has been so challenging. Apple is famous for its tight integration of components, so if I had to guess, this is where I suspect problems have arisen.
On the other hand, Qualcomm’s next-generation 5G modems they are extremely impressive, and early leaks suggest there’s still a lot to like about Apple’s iPhone 15 plans. Included redesigned standard models and a new iPhone 15 Ultra with titanium chassis Y dual-sided front cameras. USB-C also has a hot tip, but far from true.
Either way, Apple seems determined to make a splash in 2023 after Disappointing iPhone 14 and iPhone 14 Plus sales.