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Apple's self-developed 5G chip plan, which has been rumored in recent years, has made new progress.

Analyst Ming-Chi Kuo wrote last night that Apple will launch the iPhone SE 4 in the first quarter of next year, which will be equipped with Apple's self-developed 5G chip for the first time. Then, in the third quarter of next year, the iPhone will be regularly updated. The ultra-thin iPhone 17 Slim, which is rumored to be more expensive than the Pro Max, will also be equipped with its own 5G chip. The other three iPhone models may continue to be equipped with Qualcomm chips.

Although it seems a bit puzzling at first glance that the self-developed baseband is only launched on the iPhone SE 4 and iPhone 17 Slim, these two models are not expected to become the main sales force, and are very suitable for "testing the waters". It also shows that Apple is not so confident in its own baseband.

▲ It is rumored that due to the lagging progress of self-developed baseband, the release of iPhone SE 4 has been postponed from this year to next year. Source: Wccftech

Apple has achieved great success in developing its own processors, but it has not been so smooth sailing in the field of baseband chips. In 2022, there was news that Apple would launch its own baseband in the iPhone 15 series. As a result, Apple and Qualcomm renewed their contract again until 2026 last year, and the rumored Apple baseband chip did not arrive as expected.

The delays over and over again also illustrate the difficulty of developing baseband chips, which we have discussed in detail in our previous article. Simply put, this small chip responsible for cellular data connection must be able to achieve seamless connection with hundreds of communication operators around the world and adapt to various communication frequency bands.

Qualcomm has become the strongest baseband supplier with its patents and technologies. Apple once tried to switch to Intel in the iPhone 7 era, and it was from that time that the iPhone began to be associated with the impression of "poor signal".

▲ iPhone 7 uses a mix of Intel basebands, but its performance is far inferior to Qualcomm. Image source: Chipwork

In the end, Apple compromised in 2019 and reached an agreement with Qualcomm again, but at the same time acquired the original Intel baseband team for $1 billion to accelerate the development of baseband chips.

According to a report by Bloomberg last year, Apple has spent billions of dollars on baseband research and development and invested a team of thousands of people, but its progress still lags behind Qualcomm, so it has been delaying the launch of related chips.

However, for consumers, it doesn’t matter which 5G chip the iPhone uses. The more core issue is always the experience: Will the iPhone’s signal get better by replacing the self-developed baseband?

▲ Image source: Apple Insider

I'm not optimistic about this, at least not for previous generations.

The reason is simple. Qualcomm is currently the leader in baseband supply. Apple is already lagging behind others, and if it wants to bypass Qualcomm's patents and technologies and build a baseband chip from the original Intel team, which is already inferior in technology, it will probably be difficult for it to reach Qualcomm's high level.

An Apple employee complained to Bloomberg:

Why we thought we could inherit a failed project from Intel and somehow succeed is a mystery.

If Apple really tries out its own baseband on these two iPhones next year, it will be hard not to compare them with other models that continue to use Qualcomm basebands, which can be called a "public execution."

But for a company like Apple that attaches great importance to integrated experience, self-research is an inevitable path. High integration is also an important reason why Apple's product experience has always been popular with the world.

▲ Apple's self-developed M1 chip ushers in a new era of MacBook

The path of self-research is essentially "difficult at the beginning". After the relevant products are officially launched, companies like Apple that produce for their own use can make up for the R&D costs through huge hardware sales and invest the profits into the research and development of the next generation of chips, which can easily form a virtuous circle.

And if we combine this with the rumors from a few days ago that "a small folding iPhone is about to be launched", Apple may be working towards increasing the profit margin of the iPhone.

This is also in line with Counterpoint Research's prediction of future smartphone trends, namely that the growth in mobile phone shipments will slow down further. Correspondingly, the profit margin of a single smartphone will be higher, and the revenue and profit growth of smartphone manufacturers will be faster than sales.

Products like ultra-thin and folding screens are a way to increase profit margins by creating high-end products, while using self-developed basebands can directly save the high Qualcomm technology and patent fees, directly bringing more profits.

Whether next year's iPhone will be equipped with self-developed baseband chip, and whether its performance can amaze the world again like other Apple self-developed chips, we can only wait for Apple to reveal these answers to us next year.