Sept. 20 (Bloomberg) — Apple Inc. will likely launch its own Wi-Fi chip and 5G baseband chip in 2025 to reduce its dependence on Broadcom Corp. and Qualcomm, according to a DigiTimes report. However, this could still be delayed.
Apple’s self-developed chips: a strategic shift
Latest reports suggest that Apple could be the first to use its own Wi-Fi chip in a new iPad model in 2025, while a cheaper version of the iPhone SE 4 would come with Apple’s own 5G baseband chip. Apple’s homegrown Wi-Fi chips are expected to offer higher performance, especially when dealing with high-bandwidth applications, which will allow users to enjoy a smoother experience with things like streaming media and online gaming.
Given that the current-generation iPad 10 is equipped with Broadcom’s Wi-Fi 6 chip, Apple’s own Wi-Fi chip for next year’s new iPad could be based on the Wi-Fi 6E standard. This not only improves the connection speed of the device, but also enhances network stability in a multi-device environment, further improving the user experience. In addition, the launch of Apple’s self-developed chip may also mark a new round of breakthroughs in the company’s hardware integration and system optimization.
However, some supply chain insiders said that these iPad models based on Apple’s self-developed Wi-Fi chips may be delayed until 2026 when the iPhone 18 series will be launched. This delay could be related to challenges with technology validation and mass production capabilities. Apple needs to ensure that it can meet the market’s demands when it launches new chips without sacrificing the quality and performance of its products.
Potential delays in Wi-Fi and 5G chip rollout
Rumors of Apple developing its own 5G baseband chips have been around for a long time. In 2019 alone, Apple acquired Intel’s mobile baseband chip division for $1 billion, gaining over 17,000 patents and over 2,200 employees. Then for years, Apple tried to develop its own 5G baseband chips to replace Qualcomm’s 5G baseband chips. But the plan didn’t go well. Technical challenges and market changes have slowed Apple’s progress in this area, despite a strong patent base and team support. As technology advances, Apple’s leadership in electronic communications will be further solidified.
As a result of the setback of the plan to develop its own 5G baseband chips, in September 2023, Apple also signed a three-year baseband chip supply agreement with Qualcomm, which will supply 5G baseband chips and RF systems for Apple iPhones launched in 2024, 2025 and 2026. Qualcomm CEO Cristiano Amon also confirmed in the first quarter of fiscal year 2024 earnings meeting, Qualcomm recently reached a new agreement with Apple, the 5G baseband chip supply agreement previously reached by the two sides was postponed to March 2027. This also means that the commercial process of Apple’s self-developed 5G baseband chips has been further delayed, reflecting the fact that Apple still needs to take a longer road in terms of self-development.
Impact on Qualcomm and market dynamics
It is worth noting that, according to Wall Street research firm Wolfe Research analyst Chris Caso also released a research report in August of this year, Apple will be launched in 2025 in the iPhone 17 series of the introduction of self-developed 5G baseband chip, which is expected to result in a 35% reduction in Apple’s contribution to Qualcomm’s revenue year-on-year, and is expected to be reduced by another 35% in 2026, according to the report. If this prediction comes true, it will have a significant impact on Apple’s revenue to Qualcomm. If this prediction comes true, it will have a significant impact on Qualcomm’s revenue, and will also force it to look for new cooperation opportunities to make up for the loss.
Chris Caso also believes that only a few models in the initial Apple iPhone 17 series will use self-developed 5G baseband chips, the U.S. telecom industry to sell the new iPhone will remain only equipped with Qualcomm 5G baseband chips to match the U.S. 5G mainstream millimeter wave (mmWave) band. This strategy not only reflects Apple’s prudence in technology transition, but also shows the company’s balance between ensuring user experience and technological innovation. With the gradual maturation of self-developed technology, Apple may be able to realize the full application of self-developed chips in more products in the future, thus enhancing its competitiveness in the market.
