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Apple to Replace Qualcomm Modems with Internally Developed Devices
 
Last December Apple started developing in-house cellular modems that would eventually replace Qualcomm in its devices. Apple analyst Ming-Chi Kuo now estimates that Apple will start using its own 5G baseband chip as early as the 2023 iPhone lineup.

• Kuo notes that high-end 5G Android phone sales are "sluggish" and with the loss of Apple as a customer, Qualcomm would have to "compete for more orders in the low-end market to compensate."
• Apple's move into modems wasn't surprising following the $1B acquisition of Intel's smartphone modem business in 2019.
• When the global semiconductor shortage eases, Qualcomm and rival MediaTek "will have less bargaining power over brands," which would increase the competitive pressure in the low and mid-end markets, says Kuo.

According to Kuo, Apple plans to include its own custom-designed 5G baseband chip starting with the launch of the 2023 iPhones "at the earliest." Apple currently relies on Qualcomm for its 5G iPhone modems and is expected to continue its reliance until it diverts to its own chip. When the diversion occurs, Qualcomm will be forced to enter new markets to compensate for the loss of orders from Apple.

• We predict that the ‌iPhone‌ will adopt Apple's own design 5G baseband chips in 2023 at the earliest. As Android sales in the high-end 5G phone market are sluggish, Qualcomm will be forced to compete for more orders in the low-end market to compensate for Apple's order loss. When the supply constraints improve, MediaTek and Qualcomm will have less bargaining power over brands, resulting in significantly higher competitive pressure in the mid-to low- end market.

 
Apple awarded Corning $45m from its Advanced Manufacturing Fund to fund additional capacity and R&D efforts. Corning supplies precision glass for the iPhone, Apple Watch, and iPad.