Reports indicate that Apple will stop sourcing baseband modems for its iPhones from Qualcomm and instead use the ones supplied by Intel beginning this year. According to the report prepared by Digitimes, about half of the baseband modems in the iPhone 8 will be supplied by Intel this year and the percentage could rise to 70% next year.

Historically, baseband modems from Intel have always been cheaper though they suffer from poor performance compared to baseband modems from Qualcomm. This means that the Intel modems do not only suffer from low power efficiency bit also have poor cell signal reception as well as lower speeds. Speed and reliability are critical for Apple especially at a time when the popularity of new LTE technologies is growing.

Premium Android smartphones

Apple cannot also afford to compromise on quality in light of the fact that rivals are producing smartphones that are as good as the iPhone if not better. Currently, most of the high-end smartphones running on the Android operating system use Qualcomm components. However, the baseband modem that Apple will be buying from Intel is a new product and thus might offer better performance. This is the XMM 7560 LTE which now also supports both GSM and CDMA technologies

Apple’s shift away from Qualcomm comes at a time when the two tech companies are locked in a legal dispute over the patent fees charged by Qualcomm for its patents. Qualcomm’s intellectual property is in every iPhone and even though Apple does not dispute that, the Cupertino, California-based tech giant has claimed that the licensing fees that Qualcomm charges are too high. The chipmaker was also accused of having monopolistic tendencies.

Royalty payments

Apple has consequently taken the dispute to court besides instructing its suppliers such as Foxconn to halt royalty payments due to Qualcomm. The chipmaker has also countersued besides making it clear that in case the countersuit flops, it will forward the case to the International Trade Commission with a view to seeking to have iPhones banned from being imported into the United States, Apple’s most lucrative market.