Apple in talks to acquire Intel’s smartphone chip unit for over $1 billion: Report

The acquisition is said to help Apple reduce dependence on Qualcomm for key iPhone chips.

Apple is in talks with Intel for cellular modem unit (REUTERS)

Apple is in talks to buy Intel's smartphone modem chip unit, a move that would help the iPhone maker control a key component, the Wall Street Journal reported on Monday.

The Journal cited unnamed people familiar with the matter as saying the deal would cover Intel patents and staff valued at a billion dollars, but that it might not come together.

Apple has been investing in its own mobile chips to ramp up performance and features in its devices and reduce its dependence on Qualcomm.

Intel earlier this year announced it was abandoning efforts to compete with modem chips for smartphones synched to new-generation "5G" networks.

Intel made the revelation a day after Apple and Southern-California based Qualcomm said they agreed to "dismiss all litigation" against each other worldwide in what had been a sprawling battle over royalty payments.

The last-minute settlement cut short a courtroom clash between the tech giants just as it was getting underway in California.

For two years, the companies had fought a multi-front brawl that could have required Qualcomm to pay billions.

At the heart of the battle were the royalties Qualcomm charges for its patented chips, which enable smartphones to connect to mobile networks.

Apple accused Qualcomm, which holds the most patents for chips, of taking advantage of its dominant position to charge exorbitant amounts for its chips or access to its patents.

Qualcomm denied the allegations and accused Apple of abusing its position and of taking legal action to negotiate prices down.

Several hours after the deal was announced, Intel said it was withdrawing from the 5G smartphone modem business, without indicating whether its decision was a cause or consequence of the agreement its rival signed with Apple.