“Intel’s interest in derailing that deal reflects its worry that a combined Broadcom-Qualcomm, which would create the third-largest chip company by revenue after Intel and Samsung Electronics Co., would endanger its competitive position, the people said,” Greenwald reports. “A merged Broadcom and Qualcomm would combine market-leading smartphone chips with a strong presence in data centers, two areas Intel has targeted for growth. ”
“There are several reasons why such a combination may not happen,” Greenwald reports. “Since early 2017…Qualcomm has been in a bitter legal war with Apple over its royalty rates, which the iPhone maker alleges are unfair. Qualcomm hasn’t been able to resolve the conflict quickly, and Apple is considering replacing Qualcomm chips entirely with products from rivals including Intel. Broadcom also sells chips to Apple, and its chief executive, Hock Tan, claims to have a strong relationship with the iPhone maker. If Broadcom takes over Qualcomm, he believes he could resolve the Apple dispute. In that case, Apple could boost Qualcomm’s presence in iPhones at Intel’s expense, especially as 5G ramps up in coming years.”
Read more in the full article here.
“The threat to Intel’s business isn’t new; the company has been at risk for more than a decade,” Jean-Louis Gassée writes for Monday Note. “By declining Steve Jobs’ proposal to make the original iPhone CPU in 2005, Intel missed a huge opportunity. The company’s disbelief in Apple’s ambitious forecast is belied by the numbers: More than 1.8 billion iOS devices have been sold thus far.”
“Intel passed on the biggest product wave the industry has seen, bigger than the PC,” Gassée writes. “One may wonder why then-CEO Paul Otellini didn’t make Apple an offer they couldn’t refuse: Access to Intel’s superior silicon manufacturing technology. At the time, Apple had nothing; Intel held all the cards.”
“But perhaps the ultimate source of urgency for Intel is the resolution of Qualcomm vs Apple,” Gassée writes. “Belatedly, Intel realized it needed a seat at the smartphone table. Despite troubles with its more advanced manufacturing processes, the company managed to supply some wireless modems for the iPhone 7, 8 and X. Ironically, the alliance was aided by a long standing and bitter intellectual property dispute between Apple and Qualcomm. If Broadcom’s acquisition of Qualcomm proceeds, the dispute with Apple could disappear… If the dispute is settled, Intel loses its wireless modems deal with Apple. No mobile CPUs + no modems = nothing of substance. Broadcom would be in charge — they would hold all the cards.”
Read more in the full article – recommended – here.
MacDailyNews Take: The price for Intel’s poisonous hubris has come due.
Intel should be praying that the U.S. government scuttles the Broadcom-Qualcomm merger so they don’t have to try to buy and attempt to integrate Broadcom and that Apple’s Qualcomm dispute goes on for years, so that Intel can at least have time to figure out how to finally make decent modems for iPhones.
Obviously smarting from not being able to get into iPhone… Intel sounds like they’re due for an attitude adjustment right about now. And Apple has just the guy to deliver it. — MacDailyNews, October 22, 2008
[Intel’s decision to pass on Apple’s iPhone] has to be close to the top of the list of Biggest Business Mistakes in History. — MacDailyNews, May 17, 2013
Whoops! Intel’s Otellini passed on Apple’s iPhone – May 17, 2013
Intel CEO Otellini: We’ll build chips Apple ‘can’t ignore,’ for iPad and iPhone – May 12, 2012
Intel chastises executives who slammed iPhone’s ARM processor – October 23, 2008
Intel slams Apple iPhone’s use of ARM processors, says bogs down device – October 22, 2008
Apple engineer confirms Apple working on ARM processor for the next-generation iPhone – September 15, 2008
No Intel inside Apple iPhone – July 1, 2008
Apple CEO Jobs: ‘PA Semi is going to do system-on-chips for iPhones and iPods’ – June 11, 2008
Why Apple bought PA Semi – April 24, 2008
Apple can now make its own processors – April 24, 2008
Apple buys microprocessor design company PA Semi for $278 million in cash – April 23, 2008
At least three ARM processors inside Apple’s iPhone – February 07, 2007