In addition to custom processors, it was reported that Apple was also building an in-house Wi-Fi chip. Now, tech analyst Ming-Chi Kuo claims that the tech giant has put the development of its own Wi-Fi chip on hold “for a while”.
Reportedly, the Cupertino tech company wants to reduce reliance on partners by developing its own chips for the iPhone lineup. Like it replaced Intel processors with M series Apple Silicon in the latest Macs, Apple planned to drop Broadcom and Qualcomm in favor of its own Wi-Fi, Bluetooth, and 5G chips.
Apple found it difficult to replace Broadcom’s Wi-Fi + Bluetooth combo chips instead
As per the report, the company’s investors were worried about the impact of its Wi-Fi chip on Broadcom’s Wi-Fi chip business. However, the company has put the development of its custom Wi-Fi chip on hold because it found it difficult to replace Broadcom’s Wi-Fi + Bluetooth combo chips.
More specifically, Apple’s previous development for Wi-Fi solution was the Wi-Fi-only chip and not the Wi-Fi+Bluetooth combo chip. From a design standpoint, developing a Wi-Fi+Bluetooth combo chip is more challenging than just a Wi-Fi-only chip. Since most of Apple’s products use the combo chip, it would be even more challenging to replace Broadcom’s combo chips with its own if Apple decides to do so.
The tech giant is now primarily utilizing IC design resources on the development of A series and M series processors for iPhone and Mac because a slowdown of processor upgrades would be “unfavorable to sales” of products. The focus on processors has also delayed the development of the company’s custom 5G modem.
Broadcom will supply advanced Wi-Fi 6E for the upcoming iPhone 15 series. The faster Wi-Fi 6E tech recently debuted in the new MacBook Pro and Mac mini (2023 models). Therefore, it is speculated that investors do not need to worry about Broadcom’s Wi-Fi chip business as it would be the “leading beneficiary” of the adoption of Wi-Fi 6E/7 chips with higher ASP in the next 2 to 3 years.
In the next 2–3 years, Wi-Fi chips will usher in critical Wi-Fi 6E/7 upgrades. It’s riskier for Apple to use its own Wi-Fi chips aggressively when the industry standard markedly changes.
Instead, in the next couple of years, Apple and competitors will start adopting Wi-Fi 6E/7 chips with higher ASP, and Broadcom is a leading beneficiary in this trend. Also, Broadcom will be the biggest winner from the new iPhone 15’s upgrade to Wi-Fi 6E.