Samsung launches a new 5G modem.

Korean electronics giant Samsung had revamped its Exynos 5G modem and processor range with a couple of new ones manufactured on the 7nm EUV process.

The Exynos Modem 5123 and Exynos 990 processor are made using a 7 nanometer process technology, which is about as advanced as silicon tech gets these days and uses extreme ultra-violet is some clever way to deal with the physical challenges of operating at such tiny sizes. To the layman this means you can cram more transistors into a smaller space and thus make the chip perform better.

“Milestones in technological advancements are imminent all around us,” said Inyup Kang, President of the System LSI Business at Samsung Electronics. “Mobile 5G technology is opening new avenues for communication and connection, while AI is poised to become an everyday tool for people worldwide. Samsung’s Exynos 990 and Exynos Modem 5123 are perfectly adapted for high-volume 5G and AI applications, and are designed to help the world’s most ambitious enterprises, large and small, achieve their goals of bringing new capabilities to their markets.”

Samsung has plenty more detailed technical claims to make about the new chips but you get the gist. In other news Samsung is seeking to promote its new ‘experience space’ in Kings Cross by getting people to send in their selfies, which it then beams into space and displays on a Galaxy S10 smartphone that is somehow dangling in orbit. Here’s a video about it.

 

Downbeat outlook fuelled by Huawei situation hits Qualcomm shares

Mobile chip giant Qualcomm delivered solid Q2 numbers but a gloomy outlook thanks largely to the Huawei export ban drove down its share price.

Qualcomm’s core numbers were broadly in line with expectations, with revenues a bit below but earnings per share above. But in the ensuing earnings call Qualcomm CEO Steve Mollenkopf warned of a few factors that are likely to negatively affect the company in the coming quarters.

“The Huawei export ban, along with the pivot from 4G to 5G which accelerated over the past couple of months, has contributed to industry conditions particularly in China that we expect will create headwinds in our next two fiscal quarters,” said Mollenkopf. “As a result of the export ban, Huawei shifted their emphasis to building market share in the domestic China market, where we do not see the corresponding benefit in product or licensing revenue.

“In addition, our customers in the China market are working through their existing 4G inventory and deemphasizing their second half 2019 4G launches, as they shift their priorities to their 5G launches in early 2020. As a result, we do not expect the typical seasonal benefits given this unique market dynamics. For the first calendar quarter of 2020, we anticipate reaching the inflection point as our financial results begin to reflect the benefits of our substantial efforts over the years to bring 5G to the market worldwide.”

The reason Huawei’s increased emphasis on China is to Qualcomm’s detriment is two-fold. Huawei presumably uses its own chips in devices it sells within China, so Qualcomm doesn’t have a piece of that action. It does, however, sell components to the other Chinese smartphone makers, so any increase in competitive pressure from Huawei will affect Qualcomm’s revenues from sales to them.

Compounding this is a general softness observed in the Chinese market, which Qualcomm seems to mainly attribute to a lull before the 5G storm. It looks like the channel is trying to reduce the amount of 3G/4G inventory ahead in anticipated demand for 5G devices. As a result Qualcomm has reduced its expectations for global connected device shipments this year by around 100 million.

In the longer term Qualcomm still feels pretty bullish, largely on the back of its claimed 5G modem leadership. Qualcomm reckons the Huawei 5G modem is at least 50% bigger than its one and, of course, Intel’s efforts turned out to be a complete bust. It’s hard to argue with this conclusion so, while Qualcomm’s shares were down 6% in pre-market trading at time of writing, its long term modem prospects still look pretty healthy.

Qualcomm shipment outlook

Qualcomm Earnings Infographic Q32019

Apple said to be sniffing around Intel’s modem business

Having recently ditched Intel’s modem business like a bad habit, gadget giant Apple is reportedly now thinking of buying it.

The rumour comes courtesy of The Information, which says it got the scoop from no less than four unnamed people who we’re told have been briefed on the discussions between Apple and Intel. Specifically Apple is said to be interested in Intel’s German modem operations, which is where much of the 5G R7D will have taken place.

Intel found itself as an unwitting pawn in Apple’s legal battle of will with mobile chip giant Qualcomm. Apple wasn’t happy with what Qualcomm was charging for its modems and took to the courts to do something about it. This was always just a form of negotiation, a crucial part of which was Apple’s insistence that it could just walk away from Qualcomm if it didn’t lower its prices.

The problem with this is that there are very few 5G modem players in town and even fewer that aren’t affiliated to a smartphone competitor of Apple’s. One of those was supposed to Intel, which found itself constantly defending its ability to deliver a competitive 5G modem in the face of understandable scepticism from the industry and, increasingly, from Apple itself.

Eventually the Emperor was revealed to be naked and Apple was forced to settle with Qualcomm once it became clear Intel wasn’t able to deliver. Intel wasted little time in throwing in the towel entirely on 5G modems once their only customer had ditched them and promptly retreated into the shadows, vaguely muttering about IoT.

But that doesn’t mean its efforts to deliver a 5G modem were entirely wasted. Through acquisition and organic R&D Intel must have picked up a thing or two about delivering 5G radio over the years. While Apple is forced in the mid term to rely on the loathed Qualcomm, it ultimately aspires to modem self-reliance. Since Intel’s 5G unit is presumably available at a knock-down price following its public humiliation it wouldn’t be at all surprising to see Apple snap it up, if only for a laugh.

Apple starts to count the casualties of its poor 5G campaign

It looks like one of Apple’s most senior wireless engineers has cleared off, just days after the company lost its fight with Qualcomm.

The Information has reported that Rubén Caballero, a VP of Engineering in charge of wireless stuff at Apple, has left the building. One of its mystery sources said Caballero was ‘leading Apple’s charge into 5G’, which is especially appropriate considering his surname. Since that charge was resoundingly defeated by Qualcomm’s big guns Apple seems to have decided to discreetly disband its 5G light brigade.

As is its way Apple hasn’t offered any comment on the scoop but The Information says his work emails are bouncing back and his work phone has been disconnected so the circumstantial evidence is strong in this one. Additionally Apple Insider did a bit of sniffing around of its own and got another anonymous source to confirm Caballero’s departure.

Both stories feature a fair bit of speculation about why Caballero may have galloped off after 14 years at Apple, but to us the most likely reason for any wireless casualties at Apple must be the utter farce of its attempted collaboration with Intel. Since Intel was clearly hopelessly inadequate as a 5G modem partner, Apple CEO Tim Cook must have a pretty low opinion of any of his execs that told him otherwise.

Intel admits losing Apple caused it to ditch 5G modems – well duh

Chip giant Intel silenced the non-speculation about it bailing on its much heralded 5G modem project by admitting it was due to losing Apple as a customer.

The scoop comes courtesy of the paywalled WSJ and passed on by The Verge. Intel CEO Bob Swan apparently fessed up to the WSJ saying “In light of the announcement of Apple and Qualcomm, we assessed the prospects for us to make money while delivering this technology for smartphones and concluded at the time that we just didn’t see a path.”

That comment was only a minor elaboration on what Swan said on Intel’s recent earnings call. “As you know, we recently sharpened our 5G focus,” said Swan, in textbook earnings call language. “When it became apparent that we don’t have a clear path to profitability in 5G smartphone modems, we acted. We are now winding down that business and conducting a strategic assessment of 5G modems for the PC and IoT sectors while continuing to meet our current 4G customer commitments.”

Now it’s debatable how much profitability Intel would have derived from its 5G modem sales to Apple if some commentators are to be believed, so the ‘path to profitability’ bit seems like a massive euphemism for ‘likelihood that we will ever deliver a competitive product’ to us. To be fair to Swan there’s no nice way of publicly admitting abject failure so he’s entitled to dance around the issue a tad.

Since it’s now clear that Apple was the only significant customer for its 5G modem and it has apparently deemed it too much of a liability to stick with it’s worth reviewing Intel’s historical pronouncements on the matter.

Intel reckons it has the first global 5G modem

Chip-makers embark on pre-MWC 5G virtue-signalling frenzy

Intel continues to insist it’s really good at 5G

Intel triggered into joining Qualcomm Apple spat

Intel brings forward ‘launch’ of 5G modem in bid to silence doubters

In hindsight it’s all a bit tragic isn’t it? While we don’t doubt Intel genuinely wanted to compete in the modem market it also seems to have been played like a fiddle by Apple. The fruity gadget giant used Intel as a pawn in its hostile negotiations with Qualcomm and dropped it like a bad habit as soon as that became convenient. Cold.

Intel had so little faith in the product of what must have been billions of dollars of effort put into 5G modem development that as soon as its sugar daddy went back to its former partner it pulled the plug immediately. It must surely have seen this coming for a while with all the talk of Apple trying to develop its own modems, so it was just a matter of when it owned up to its 5G failure.

To be honest 5G modems seem to be the least of Intel’s problems right now so it may have been grateful to have ditched that distraction. Swan was forced to also admit Intel was revising down its full year revenue outlook by a whopping $2.5 billion on the earnings call, driving Intel’s shares down 8% at time of writing.

“Our conversations with customers and partners across our PC and data-centric businesses over the past couple of months have made several trends clear,” said Sawn. “The decline in memory pricing has intensified. The data center inventory and capacity digestion that we described in January is more pronounced than we expected, and China headwinds have increased, leading to a more cautious IT spending environment.

“And yet those same customer conversations reinforce our confidence that demand will improve in the second half. So we’ve reassessed our ’19 expectations based on the challenges we’re seeing. Our full year outlook is now $69 billion in revenue, down 3% year-over-year and down approximately $2.5 billion from our previous estimate.”

We had a chat about the Apple/Qualcomm/Intel thing on the most recent podcast, which you can access here.

Could Huawei be Apple’s 5G saviour?

Apple has boxed itself into a corner over 5G and it’s possible that smartphone rival Huawei could provide an unlikely escape route.

This is pure rumour-mongering at this stage, but sometimes it’s fun to speculate. Such substantiation as there is comes from Engadget, which has chatted to someone who reckons they know a thing or two. Their Deep Throat says Huawei is open to flogging its 5G chip to Apple, which is noteworthy because it was previously intended solely for use in Huawei phones.

The Balong 5000 was launched at the start of this year amid much confident posturing from Huawei. That represented a pretty good effort, in principle, from Huawei but at present we have no way of knowing how it compares to market-leader Qualcomm in terms of real world performance. Even this thorough rundown of the 5G modem scene is none the wiser.

An even greater mystery is the matter of why Huawei would throw Apple a bone in this way. Some companies, such as Samsung, have a sufficiently clear separation between major business units that one can work with companies that are bitter competitors of another, as it has done with Apple. Huawei doesn’t seem set up that way, however, which would make such a decision a broadly strategic one.

The answer, presumably, would be that Huawei values growing the overall 5G market above the doubtless schadenfreude it would derive from Apple’s late entry into it. The launch of a 5G iPhone would be a major boost to global consumer 5G demand and, since Apple would presumably get there eventually anyway, Huawei might think it’s better to make sure that demand boost happens ASAP and trouser a nice lot of component revenue while it’s at it.

Apple said to be losing faith in Intel’s 5G modem capabilities

A new report suggests Apple no longer has faith in Intel’s ability to deliver a 5G modem it can stick in its 2020 iPhones.

The scoop comes courtesy of Fast Company, which cites an anonymous source that claims to have some insight into the development of the Intel XMM 8160 5G modem. This shadowy figure told Fast Company Intel has been missing incremental deadlines for the development of this critical component, which has led to understandable consternation on the part of Apple.

Equally unsurprising is the revelation that Apple is a pretty high-maintenance company to work with. While some people might take a more chilled approach to component punctuality, Apple is pretty uptight about this sort of thing and isn’t shy about giving errant suppliers a hard time. Intel presumably bent over backwards for this massive deal win, but it always looked like a bit of a reach.

Speculation around Intel’s ability to deliver began as soon as the deal was announced. Late last year Intel got so sick of this scepticism that it publicly announced it was going to have the part ready half a year sooner than previously promised. At the time that seemed like a cosmetic PR move and when asked for comment on this story Intel only had the following to say: “As we said in November 2018, Intel plans to support customer device launches in 2020 with its XMM 8160 5G multimode modem.”

That’s hardly the most strident rebuttal of these latest allegations is it? Especially the use of the term ‘plans to’ instead of ‘will’, that seems to deliberately allow for a level of wriggle room that shouldn’t be needed if everything’s going according to plan. You can see why Apple might be concerned and the report implies Intel might be starting to think it doesn’t need the hassle too.

It goes on to talk about Apple’s ultimate goal of making its own modems, pointing out, as many have previously, that this is far from straightforward. The piece cites a UBS analyst who has joined the chorus of scepticism about Apple’s ability to deliver a 5G iPhone in 2020. Of course this could all be rubbish and Intel may well deliver on its promises, but if it doesn’t Apple doesn’t seem to have a 5G plan B.

Apple will struggle with 5G for years – analyst

Not only will Apple lag its competitors by at least a year in launching a 5G phone, it might still suck anyway according to a semiconductor analyst.

Bloomberg apparently got hold of a research note from Matthew Ramsay, who heads up the TMT semiconductor business at Cowen. He seems to reckon Apple has boxed itself into a corner by ditching Qualcomm as a 5G modem supplier and is now seriously short of good options in that area. He also expressed surprised that Apple has allowed this situation to develop.

Ramsay detailed four main options for Apple for 5G, but he doesn’t think any of them are great. The first is what is generally assumed: that Apple will launch 18 months behind the competition with an Intel 5G modem that is expected to be inferior and not even support mmWave. The recent MWC show saw the first 5G phones launched but Apple tends to announce new iPhones in September, hence the big lag.

Rubbish option number two is to see if anyone else can help Apple out on the modem side of things. But Huawei is off the table due to all the aggro it’s getting from the US and Samsung would be likely to ruthlessly exploit its overwhelmingly strong bargaining position, since it’s another of the long list of companies Apple is on frosty terms with. Other than that there’s Taiwanese MediaTek, but Ramsay seems to think it’s even further behind than Intel.

A third, highly implausible, option would be for Apple and Qualcomm to kiss and make up. Not only does there seem to have been too many things said that can’t be unsaid in their bitter legal dispute, but that would be an utter humiliation for Apple and surely Qualcomm wouldn’t be able to resist imposing punitive terms. Having said that, sometimes pragmatism and enlightened self-interest prevail, but we would be amazed if they did in this case.

The last option would be for Apple to buy Intel’s modem business from it in order to accelerate the development process. This would be expensive but Apple can certainly afford it. There is, however, no guarantee Apple would improve on Intel’s efforts since modems are hardly a core competence. It’s even less likely that Apple would be able to make a material improvement in the next year or two.

A fifth option not posited by Ramsay would be for an even longer delay in bringing a 5G phone to market. Apple is brilliant at marketing and could easily throw resources at belittling 5G in the short term to downplay the significance of its absence from that market. That argument would certainly find some sympathy from us in the short term, but it would surely start to wear thin before long.

Qualcomm upgrades its 5G modem

Mobile chip maker Qualcomm has unveiled its big MWC news early, in the form of the X55 5G modem, which is five better than its predecessor.

The new modem supports both flavours of 5G as well as all the older Gs and all the spectrum bands you could possibly want. It’s manufactured on a 7nm process and promises download speeds of 7 Gbps and 3 Gbps uploads speeds. The previous X50 modem only managed a mere 4 Gbps. Even the Cat 22 LTE part manages 2.5 Gbps download.

“With significant evolution in capabilities and performance, our second generation commercial 5G modem is a true testament to the maturity and leadership of our 5G technology,” said Qualcomm President Cristiano Amon. “We expect our 5G platform to accelerate 5G commercial momentum and power virtually all 5G launches in 2019 while significantly expanding the global 5G rollout footprint.”

That ‘virtually all 5G launches’ claim could be challenged in as little as a week. We may well see some 5G handset launches at Mobile World Congress and one of the biggest smartphone vendors – Huawei – has already launched its own 5G modem. Apple doesn’t bother with MWC but has indicated it would sooner make a bonfire out of iPhones then even be in the same room as Qualcomm.

Seeking modem autonomy is perfectly understandable but Qualcomm reckons it’s pretty far ahead of the chasing pack when it comes to the tech. Huawei’s speed claims don’t seem too far off Qualcomm’s but it’s not yet known how they compare when it comes to size, power efficiency, etc. And apart from Huawei and Apple Qualcomm will probably own the rest of the 5G market.

Snapdragon X55 claims to be the first announced modem to support 100 MHz envelope tracking technology, and adaptive antenna tuning for 5G sub-6 GHz, designed for power-efficient connectivity. Qualcomm can also presumably offer it integrated into the Snapdragon 855 SoC and thus cater to all your mobile chip needs. Here’s a vid.