By now it’s old news that the iPhone XS lineup and the iPhone XR use Intel chips under the hood, rather than a mix of Intel and Qualcomm.
And while some have speculated that Apple had always wanted to use Intel-only for that particular year of iPhones, it turns out that’s not the case at all. According to Apple’s Chief Operating Officer, Jeff Williams, it’s actually Qualcomm that has taken a remarkably hard stance against Apple and actually refused to sell chips to the company for the 2018 iPhone lineup. This latest revelation comes during the Qualcomm vs. FTC trial, where Williams recently took the stand to discuss the relationship between Qualcomm and Apple.
Williams said that Apple, despite the legal battle with Qualcomm, originally planned on using a combination of Intel and Qualcomm chips in its smartphone lineup, something it has done in previous generations. From Williams’s testimony:
“The strategy was to dual source in 2018 as well. We were working toward doing that with Qualcomm, but in the end they would not support us or sell us chips.”
Williams goes on to say that Apple would have “loved” to use Qualcomm’s tech in the 2018 iPhone lineup. As a result of Qualcomm’s CEO, Steve Mollenkopf, turning down Apple, the company had to turn to Intel and request that Intel handle all of the LTE chips for the iPhones launched last year.
Interestingly, Williams goes bit further in the relationship with Qualcomm and Apple, saying that, back in 2011 when Apple finalized a contract with Qualcomm over Infineon for the use of CDMA-compatible chips, Qualcomm demanded a percentage of the iPhone’s cost. Those negotiations saw Apple initially requesting $1.50 per phone in royalties from Qualcomm, but ended up having to pay $7.50 per phone. Apple even had to agree to what is described as a “marketing incentive agreement” to dissuade the adoption of WiMax, which was the competing network capability at the time — something Apple never adopted, either.
In 2013, Apple and Qualcomm renegotiated their deal. This saw Qualcomm looking to get upwards of $10 per phone, which would have cost Apple somewhere around a billion dollars in annual licensing fees. This is where Qualcomm’s exclusivity comes into play, because Apple had to agree to this particular move to reduce the royalty fees.
This is not the first big news we’ve heard from this trial, either. Just recently it was reported that Apple had actually considered using a 5G modem in the 2019 iPhone lineup, including from Samsung, MediaTek, and Intel. However, it’s now likely that Apple will wait until 2020 to launch its first 5G iPhone.
This is an interesting discovery, mostly because the relationship between Qualcomm chips and Intel chips in iPhones has not been generally great for consumers. It wasn’t that long ago that people were going out of their way to try and find out if their iPhone was equipped with either company’s chip, because the difference in speeds was getting a lot of attention at the time. So it may be good that Apple is using one company for its chips at this point, rather than forcing a huge difference for its customer base.