Apple dips after report that future iPhone modems could lag rivals

10 June 2017, 07:03 | Myrtle Hill

Bloomberg: Apple's new iPhone speeds could lag due to modem supply

Apple may deny iPhone 8 owners new gigabit data speeds due to Qualcomm dispute -Bloomberg

While Apple could alternately decide to rely on just Qualcomm's modems, the company prefers not to use a single supplier for any one component, and it has a particularly contentious relationship with the San Diego-based chipset giant, which it is now battling in various legal disputes concerning patents and royalties. However, Intel's modem won't actually be ready for the iPhone 8's launch.

The reason? According to the source, it's the company's ongoing litigation with Qualcomm that would preventing Apple including the currently-available gigabit modem. But due to the two companies already butting heads in legal quandary, Apple has chose to use a mix of modems form both Qualcomm and Intel for the iPhone 8, according to Bloomberg. Apple is embroiled in a bitter legal fight with the chipmaker, accusing the supplier of maintaining an illegal monopoly, and it's seeking to loosen Qualcomm's grip on the market for high-end smartphone modems.

According to a Bloomberg report, Apple will eschew its chance to capitalise on gigabit LTE speeds soon to be offered by USA networks Verizon and AT&T.

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Apple now plans to use both Intel and Qualcomm modems in the newest iPhone in order to limit its reliance on a single manufacturer. The Qualcomm Snapdragon X12 and Intel XMM 7360 modems used by the iPhone 7 respectively had maximum download speeds of 600Mbps and 450Mbps. Qualcomm (NASDAQ:QCOM) is now the only company with a 1-gigabyte modem at the ready. But the rise of gigabit wireless networks could make the strategy more risky: iPhone users will have a unified experience, no matter what modem is inside the new device, but it could look even less speedy compared to newer gigabit-ready smartphones from other manufacturers. Apple also jumped on the LTE bandwagon about a year after Samsung.

Whether Apple's decision will overshadow the company's slick new design and features in the phone coming later this year, as well as its customer loyalty, remains to be seen. The stock on Friday declined 3.5 per cent to US$149.60.



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