Apple is working to bring more and more core technologies in-house. Earlier this year, the tech giant told Imagination Technologies that it would stop licensing the latter’s GPU designs in less than two years. A new report claims that Apple is developing its own power management chips that could be used in 2018 iPhones. Currently, Apple licenses the power management chips from Dialog Semiconductor, UK.
Only about half of 2018 iPhones to use Dialog’s power management chips
Reliable sources told the Nikkei Asian Review that Apple is keen to use its custom chips in 2018 iPhones, but the “timeframe is not locked down.” It means the introduction of the new chips could be delayed to 2019. Shares of Dialog Semiconductor plunged as much as 19% following the report. Apple is Dialog’s single largest customer, accounting for more than 70% of its revenue in 2016.
The power management chips control a smartphone’s battery management, charging, and energy functions. The custom chips could help Apple improve the battery life of its products by making them more energy efficient. The Cupertino company has been ramping up its semiconductor capabilities to better integrate the software and hardware of its flagship products. It would help Apple differentiate its products from rival offerings.
Sources told Nikkei that Apple plans to replace the Dialog chips only “partially” in 2018 iPhones. It means at least some of the next year’s iPhones will have Apple’s own power management chips. The rest would use Dialog processors. Power management chips are among the most expensive components in iPhones.
The most advanced power management chips in the industry
According to Nikkei, Apple’s power management chipset would be “the most advanced in the industry.” It would be capable of better monitoring and controlling energy consumption among different components. The chip will reduce power consumption, increasing the phone’s battery life. Taiwan Semiconductor Manufacturing Co (TSMC) is said to be responsible for manufacturing the new chips.
Interestingly, TSMC also contract manufactures Dialog’s power management chips that power the current iPhones. TSMC is also Apple’s sole manufacturing partner for the A11 Bionic processors used in the iPhone X. According to Bernstein Research, the iPhone maker is TSMC’s largest customer, accounting for nearly 20% of its 2017 revenue.
Apple’s decision to develop its own graphics chips almost crushed Imagination Technologies. Apple was Imagination’s largest customer that accounted for over 50% of its revenue. Imagination eventually sold itself to China-backed private equity firm Canyon Bridge. The iPhone maker also designs its own core A-series processors, a neural engine to handle AI tasks, fingerprint chips, and connection chips that allow AirPods to pair with the iPhones, iPads, and other Apple products.
Qualcomm seeks ban on the iPhone X
Qualcomm has filed three new lawsuits against Apple, claiming that the latter has infringed on 16 of its patents. Qualcomm has sought a ban on the iPhone X, iPhone 8, 8 Plus, as well as the iPhone 7 series. Most of the patents mentioned in the lawsuit are related to memory designs, power management, and carrier aggregation. The chipmaker also claims that Apple’s Portrait Mode feature violates a Qualcomm patent.
The two companies have been fighting over patents for almost a year since Apple accused Qualcomm of anti-competitive behavior and charging exorbitant royalties. Besides a ban on Apple’s flagship products, the chipmaking giant has also demanded unspecified damages and fees. Interestingly, Qualcomm wants the courts to ban only those iPhones using Intel modems, not the ones that come with Qualcomm’s own modems. Apple has called Qualcomm a “common patent troll.”
The chipmaker has also pointed to the similarities between the webOS interface and the iPhone X’s multitasking interface. Qualcomm owns patents for technologies developed at Palm, including the webOS. It has accused Apple of copying the webOS interface “without license or permission.” Apple has also filed a new lawsuit against Qualcomm, targeting the Snapdragon 800 and 820 processors.
Apple has sold more than 15 million iPhone X units so far
According to Rosenblatt Securities, Apple sold more than 6 million iPhone X handsets during the Black Friday weekend. The research firm estimates that more than 15 million units of the iPhone X have been sold since launch. That’s a huge number, especially given it is the most expensive iPhone Apple has ever launched. Rosenblatt told investors that the 256GB model was selling twice as fast as the 64GB version.
Apple has ramped up production to meet the iPhone X demand. The shipping time in the US has come down from 5-6 weeks to just one week. KGI Securities analyst Ming-Chi Kuo says Apple’s suppliers have increased iPhone X output from 50,000 to 150,000 unit per day a few weeks ago to a staggering 450,000 to 550,000 units a day now. The device will continue to see strong demand through the holiday shopping period, and in early 2018.