Apple (NASDAQ:AAPL) has recently extended its 5G modem partnership with Qualcomm (NASDAQ:QCOM) for an additional three years, indicating potential challenges with the development of its in-house modem, codenamed 'Sinope'. This decision follows reports that the first prototypes of Apple's 5G modem were not only slow but also prone to overheating, making them significantly inferior to Qualcomm's current versions.
The extended agreement with Qualcomm will cover smartphone launches in 2024, 2025, and 2026, according to a statement by Qualcomm. The companies' previous agreement was set to expire this year, and the upcoming iPhone was expected to be one of the last relying on Qualcomm modems.
A Wall Street Journal report revealed that Apple's in-house 5G modems are estimated to be three years behind Qualcomm. The report also highlighted issues such as poor communication between managers and lofty ambitions as factors contributing to the project's delay.
The development of the in-house modem began in 2018 under the leadership of former wireless director Jaydeep Ranade. Despite Apple's unmatched prowess in the custom silicon segment, it faced difficulties in developing a modem that complied with strict connectivity regulations worldwide and was compatible with different wireless carriers.
Apple had initially planned to debut its custom-built 5G modem in iPhones starting in 2025. However, given the performance and efficiency challenges faced by the prototypes, there is a chance that the company might postpone the official launch again.
Previous reports had suggested Apple would debut its custom-built 5G modem as early as 2023. However, these expectations seem to have been dashed as unnamed Apple executives acknowledged that their first custom 5G chips were far behind Qualcomm's leading Snapdragon X75 modem.
It is now uncertain whether Apple will unveil its first in-house 5G modem during the iPhone 16 announcement next year. Despite acquiring Intel (NASDAQ:INTC)'s smartphone modem business in July 2019 and adding 2,200 Intel engineers to its chipset operations globally, Apple's ambitious project seems to be facing significant hurdles.
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