Earlier this month, Intel announced that it was shutting down its modem business right after Apple and Qualcomm announced that they have settled all their legal issues and signed a four-year patent licensing agreement. Adding insult to injury, Apple poached Intel’s lead 5G engineer in February.

A leaked email obtained by The Telegraph reveals that Apple poached Intel’s lead 5G modem engineer Umashankar Thyagarajan in February. Apart from leading Intel’s 5G modem efforts, Thyagarajan had also played a key role in developing previous Intel modem. He had been working at Intel for 7 years and was serving as Senior Director of 5G project engineering since the last 3.5 years.

It is no secret that Apple has been working on designing its own in-house modem, though that is still a few years away from seeing the light of the day.

No wonder then that Thyagarajan leaving Intel came as a huge blow to the company’s 5G efforts. Apple and Qualcomm settling their differences and signing a four-year licensing agreement acted as the final blow for Intel’s modem business.

Intel engineers were already struggling to meet its promised 5G modem schedule to Apple. The delay meant that Apple possibly saw itself not being in a position to launch a 5G iPhone in 2020. Plus, even if Intel managed to get a 5G modem ready in time, it was likely going to be inferior to Qualcomm’s offering which is clearly the undisputed leader in modem business.

Our Take

Ultimately, Intel realized that with no proper leader for its 5G modem business and no clear path towards profitability, the smart thing to do would be to shut down the business instead of bleeding money. Despite Intel shutting down its 5G modem business, the company will continue to supply 4G modem chips to Apple as per its current commitment.

[Via The Telegraph]

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