Intel is pulling back from its 5G smartphone modem business, following Qualcomm’s settlement with Apple.
Apple and Qualcomm were in a long-drawn dispute over patent, during which Intel was delivering chips to the iPhone maker, But on Tuesday, the dispute ended with Apple and Qualcomm announcing a six-year licensing agreement as part of royalty settlement. That in turn, has led Intel to hold off launch of its 5G modem products for smartphones.
Intel "does not expect to launch 5G modem products in the smartphone space, including those originally planned for launches in 2020," the company said. The company, however, has suggested that it will continue investing in its 5G network infrastructure business.
Intel had earlier indicated that margins from the device market were thinner compared to data centers business. In his latest statement, CEO Robert Swan said about the smartphone market, “It has become apparent that there is no clear path to profitability and positive returns”.
Intel said that it will continue to meet its existing commitments for 4G smartphone modem product line.