Apple's new iPhone speeds could lag due to modem supply

That's because Apple won't be using Qualcomm's newest X16 LTE modems - the ones capable of the ultra-fast 1 gigabit per second connections carriers have been promising us -in the latest iPhone, according to a new report in Bloomberg.

Apple is moving to dual source the wireless modem chips it uses in its iPhones because of its legal fight with supplier Qualcomm (QCOM) over patent licensing and royalty terms.

Apple and Qualcomm are now in the middle of a legal battle, with the former company claiming that the latter one has been abusing its position as a manufacturer of important cellphone chips to ask for unreasonable patent licensing terms. "That's why Apple will stick with Qualcomm modems for some of its new iPhones while relying on Intel for others".


As Bloomberg points out, the original iPhone launched in 2007 without support for 3G networks and went on to be a revolutionary piece of technology that changed the industry. Last year, the company's revenue from iPhones, which generates more than 60 percent of Apple's $216 billion annual sales, fell for the first time.

For its part, Apple portrays its smartphones as better than Samsung's, and judging by the queues of eager customers outside Apple stores following a new iPhone announcement, the market for high-end handsets doesn't seem to care much about the device's innards. It's one area where service providers can't afford to be seen as laggards. Other major technology stocks also took a beating Friday, with the tech-heavy Nasdaq index falling 1.8% for the day. The ability to advertise a service that's 100-times faster may help carriers shift consumer focus to network performance and away from cut-throat pricing. AT&T has started 1 gigabit mobile service in Austin, Texas, and plans to expand to as many as 20 cities this year.

The next iPhone won't be the absolute fastest phone for downloading files or streaming music, because it will likely lack a gigabit LTE modem, Bloomberg reported on Friday.


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