iPhone C1 modem chip: Why Apple is shifting from Qualcomm chip maker

Apple iPhone 16e has finally arrived and now we all know how strategically they have launched their newest budget iPhone 16e with flagship-like features and how it is making headlines everywhere in the world.

There is another one employing which Apple made a statement to chipmakers and that is the iPhone C1 modem chip, the very first cellular processor made inhouse by Apple upon launching the iPhone 16e to reduce Qualcomm's modem share in Apple devices and to become independent fully in the future.

Why did Apple suddenly plan to have in-house chips?

The C1 modem subsystem makes its debut in the $599 iPhone 16e, and is the most significant hardware innovation since Apple's $1 billion purchase of Intel's smartphone modem business in 2019. The custom chip is part of Apple's larger plan to move more component design in-house after switching to custom ARM-based processors for iPhones and Macs.

"We build a platform for generations. C1 is the start, and we’re going to keep improving that technology each generation so that it becomes a platform for us that will be used to differentiate this technology for our products,” Johny Srouji, senior vice president of hardware technologies at Apple," Reuters reported.

iPhone C1 modem chip and its features

The new C1 modem chip for the iPhone has been tested with 180 carriers across 55 countries to ensure compatibility. Although it features custom GPS systems and satellite connectivity features, the chip itself does not yet have millimetre-wave 5G capability – an area where  Qualcomm has extensive expertise.

The integration of the C1 modem with Apple's processor chips boosts network performance, according to the company. Arun Mathias, Apple's vice president for wireless software, said the integration enables the phone to prioritize time-sensitive data transfers during congestion on the network, resulting in improved connectivity metrics during high-use times.

In the words of Apple's vice president of iPhone product marketing, Kaiann Drance, the iPhone 16e offers better battery life than other 6.1-inch iPhones, crediting the increase to the C1. The 16e shares the same A18 processor chip as other iPhone 16 models and has the ability to run Apple's newest artificial intelligence features, which are currently offered by OpenAI.

What will be the global impact?

Even with its shrinking modem share, Qualcomm has a technology licensing deal with Apple through at least 2027. The stock of Qualcomm increased by 1% after the announcement, while Apple's stayed flat.

Designing custom modem chips is a heavy technical hurdle. Only Samsung, MediaTek, and Huawei have managed to design equivalent chips. Modem chips must be compatible with hundreds of carriers worldwide and adhere to varying regional network standards and specifications.

Apple's history with Qualcomm

Apple's action comes against a complicated history with Qualcomm, such as a court battle resolved in 2019 after Intel could not offer competitive alternative modem solutions. Even with new supply deals with Qualcomm, Apple continued to develop its internal modem technology, heavily investing in research and development capabilities.

We're not the merchant vendor to match Qualcomm MediaTek and others. I think we're doing something differentiating that our customers will take advantage of," Srouji said, stressing Apple's attention to building products for their devices instead of following competitor specs.

Will new C1 modem chips enable 5G Connectivity?

Apple officials have refused to say when their chips could add millimeter wave 5G support or outline a roadmap for transitioning away from Qualcomm silicon. Yet Apple's investment levels indicate that in-house modems are the company's long-term strategy.