Report: Apple To Use Intel Cellular Modems In 70 Percent Of 2018 iPhones, 100 Percent In 2019

Apple reportedly is planning to use Intel cellular modems for 70 percent of its new iPhones coming out this fall and 100 percent of iPhones in 2019.

Citing a source familiar with Apple's plans, a report from Fast Company Wednesday said Intel potentially could supply more than 70 percent of iPhone modems this year if it can deliver under a certain timeline and budget. If Intel falls behind, Qualcomm may supply more than the 30 percent of modems it's currently slated to deliver this year, according to the report.

Apple is taking a wait-and-see approach because this is the first year Intel is handling the fabrication process for its modems after it had been previously handled by TSMC, which had been fabricating Intel's modem chips since Intel acquired Infineon's Wireless Solutions unit in 2010, Fast Company said. The publication's source said Intel has yet to reach a satisfactory yield rate for modem chips, but that Intel engineers are confident they can sort out issues before production ramps up.

Should Intel's production run meet Apple's expectations, the smartphone giant plans to use Intel's modems for 100 percent of its phones next year, according to the report. Intel first started supplying some modems to Apple for the iPhone 7 in 2016 after Qualcomm had acted as the main iPhone modem supplier for the previous five years.

Santa Clara, Calif.-based Intel declined to comment. Apple, based in Cupertino, Calif., did not respond to a request for comment.

Bob Venero, CEO of Holbrook, N.Y.-based solution provider Future Tech, told CRN that the potential move would be good news for Intel after a report earlier this month said that Apple is planning to ditch Intel CPUs for Mac computers as early as 2020.

"If they're able to pull this off and it does happen, it puts them in a much stronger position to go to other phone OEMs potentially," he said.

However, Venero added, Intel needs to make sure it doesn't run into more security snafus like it did with the Meltdown and Spectre side-channel vulnerabilities found in its CPUs earlier this year.

"Hopefully as Intel goes into this relationship with Apple, they are very cognizant that there are no security flaws in that Intel chipset, like we've seen with Spectre and Meltdown. It would be a disaster," he said.

Bacem Moussa, CEO of Boston-based solution provider TSP, said Apple's decision would be a "nice comeback" for Intel and would show that there is still an alliance between the two companies.

"It's a realignment of the products rather than a challenge to the alliance, and I think that's a good thing. It's a commitment to a long-term relationship," he said.