Qualcomm’s dominance weakens as major companies look elsewhere for 5G modems

Android Authority’s latest Pixel leak reveals that Google has not chosen Samsung or Qualcomm to build the modem in its upcoming Pixel 10 smartphones. No, MediaTek has been chosen as the next wireless partner, specifically its unannounced T900 modem. In related news, Apple is reportedly preparing to remove Snapdragon from the next iPhone SE 4 and possibly some iPads in 2025, and plans to completely replace Qualcomm as early as 2027. Two major consumer electronics brands will become giants in the coming years as they consider options other than US baseband.

Although the companies’ motives may be slightly different, the loss of Apple would be a serious blow to America’s largest 5G phone silicon supplier. It’s worth pointing out that Apple’s iPhone accounts for more than half of the U.S. market share, according to recent counts. Qualcomm modems are now found in a significant number of flagship phones in their home country, with Qualcomm modems powering Samsung Galaxy flagships in the US. Of course, it’s also used in other parts of the world where iPhones and China’s flagship Android are sold in large numbers.

Qualcomm currently has a diverse product portfolio and is also expanding into the mobile space based on the strength of its baseband portfolio. The company remains a key player in the 5G transition, with close relationships with major mobile phone brands and carriers, including Verizon. Losing two of the better-known mobile phone brands in the US will definitely hurt, leaving the company even more reliant on application processor sales in the Android market (and, of course, its extensive portfolio of network patents). It turns out. However, it remains to be seen how exactly this will play out, as Apple’s modem development has been teased and delayed for years.

Still, there are various reasons why Apple wants to bring modem development in-house. While pursuing a custom 5G modem isn’t necessarily a cheap option, it’s clear that the cost of key components of the company’s most valuable products is high. Apple paid about $1 billion for Intel’s defunct modem business in 2019, but it’s still profitable despite years of reported development problems and sneaky access to Qualcomm’s extensive patent portfolio. has not been obtained. Apple’s first 5G modem isn’t expected to be all that great either, and will probably be a step down from Qualcomm’s current best. For example, it doesn’t support mmWave technology, which makes it a failure for major US networks like Verizon. Apple is still at least a few years away from achieving full modem independence.

Still, Apple has paid billions of dollars in royalties to Qualcomm over the past decade and has a contract through 2027, so it could be looking for more favorable financial terms beyond that. be. Apple also reportedly expects to outperform Qualcomm’s technology in the long run with better SAR limits, better supporting satellite capabilities, and increased efficiency, and we’d say yes. . Still, Apple is making significant changes to iPhone modem settings that wouldn’t be possible just by buying off-the-shelf products from other companies.

Beyond that, there is a market that goes beyond smartphones. Introducing 4G/5G capabilities to the MacBook series will close the special gap with connected Windows PCs. Vision Pro could be a precursor to more portable augmented reality glasses that benefit from data connectivity. Nowadays, you can connect modems to things like cars and wearables. Apple would no doubt want to keep these profits rather than pass them on to its major rivals.

By bringing development in-house, Apple could theoretically scale designs for different product segments more cost-effectively. Integrating modems into processor silicon will be a key milestone in making 5G pervasive across products, but once modems are installed alongside Apple’s custom CPU, GPU, and NPU smarts, full house (Bluetooth ) will be installed. and Wi-Fi in 2025). Additionally, modems are a great place to incorporate technology that helps with tighter integration between devices and levels up Apple continuity. Qualcomm has a similar idea for Snapdragon Seamless, but we haven’t seen it arrive yet. This is the perennial question with some of Qualcomm’s more interesting ideas.

As for Google, it’s looking for a high-end partner after having mixed success with Samsung’s Exynos modem and Tensor chipset combination. Qualcomm has long been considered a premium option and would have been the Exynos replacement of choice for many, but if reports about the price of the company’s mobile processors are true, its high-end option It’s becoming more and more expensive. Area, power, and other considerations will definitely factor into your decision at Team Tensor, as well as the price to get cutting-edge features like satellite connectivity.

Unfortunately, we don’t have enough information about MediaTek’s T900 to really compare it to Qualcomm’s current best. However, MediaTek emphasizes that the current T800 models are power efficient and have a small footprint due to integrated power and transceiver components. It supports both sub-6Ghz and mmWave, making it suitable for global and US markets. Performance is obviously important, but the T800 is a premium tier option and the T900 is even better.

Nevertheless, MediaTek is considered to be a more affordable player in the SoC and modem market, and recently leaked documents indicate that manufacturing costs are particularly important to Google’s goals for next-generation Tensor products. It is emphasized. Of course, we don’t know the details of Google and MediaTek’s deal, but it’s easy enough to piece together the above to Google’s benefit. For MediaTek, acquiring a major U.S. brand would certainly be a big win for Taiwan’s premium brands, which are all too often overlooked outside of Chinese brands.

Apple’s custom modem ambitions and Google’s switch to MediaTek are likely to significantly reduce major phone brands’ dependence on Qualcomm hardware, but the road ahead is uncertain and fraught with challenges for both companies. There is.

Apple’s potential for cost savings and tighter hardware and software integration may come at an initial performance sacrifice. For Google, MediaTek’s value proposition may offer affordability and efficiency, but it must prove real-world performance compared to Qualcomm’s well-established flagship product.

These upcoming changes could reshape the mobile industry in North America and even globally. However, Qualcomm still has a number of lucrative 4G and 5G patent licensing deals, so it will likely remain an important baseband player even if it doesn’t sell many modems directly. The company is already diversifying its products beyond modems, but future growth may depend on emerging technologies such as automotive and Android XR rather than piggybacking on a few consumer smartphone brands. be.