Beyond a new entry phone, there is a long game here: total vertical integration.
Here are some reasons why Apple is moving in this direction:
1/ Cutting dependency on Qualcomm
Apple has been reliant on Qualcomm for 5G modems, a relationship marked by legal battles. By bringing modem development in-house, Apple is doing what it does best: ie. vertically integrating key technologies to control its own destiny. Just like it did with Intel by replacing Mac processors with Apple Silicon, Apple is positioning itself to phase out Qualcomm and remove a critical supply chain dependency.
2/ Custom silicon = Better efficiency & performance
Apple’s success with M-series chips and A-series processors has proven that tight integration leads to better power efficiency and performance. An Apple-designed modem could dramatically improve battery life, signal strength, and thermal efficiency, all these being key pain points in mobile networks. Expect Apple to leverage its silicon expertise to optimize connectivity just like it did with CPU and GPU design.
3/ Strategic cost control & Supply chain leverage
Modems are one of the most expensive components in a smartphone. By designing its own, Apple reduces component costs and gains pricing leverage over suppliers. This is classic Apple strategy: ie. drive down external reliance while increasing control over margins. Over time, this will make iPhones cheaper to produce, even as Apple maintains its premium pricing.
4/ The long play: modems beyond the iPhone
A 5G modem isn’t just for phones. Apple’s in-house development opens the door for modem integration across all Apple devices (iPads, Macs, and even future AR/VR wearables). Imagine an M-series Mac with native 5G support, eliminating the need for Wi-Fi tethering. Apple’s goal isn’t just to make a modem, it’s to create an ecosystem-wide connectivity advantage.
Let’s see how Apple’s modem works in real life and if this transition will continue to iPhone 17 and other devices. LINK
