In House iPhone Baseband Chip Development Herculean Task [Analyst]

Last week it was rumored that Apple might be looking to start developing baseband chips for future iPhones in-house. Currently it sources said chips from companies such as Qualcomm. Apparently it has already started putting together a new engineering team, recent hires corroborate the rumors. Apple’s custom baseband chips were not expected to be seen before 2015, but today an analyst estimates that it may take Apple as much as five years to develop a custom baseband chip. The analyst doesn’t believe Apple will take on this “herculean task.”

In a note to investors, Deutsche Bank analyst Brian Modoff says that the issue in developing a custom baseband doesn’t have to do with the money Apple is willing to spend on it, rather the time it needs to create the chip. According to his estimates, Apple would need five years at the very least, with top-tier talent and as many as 1,000 engineers to accomplish this.

Modoff believes that instead of moving design and development in-house, Apple may simply be looking to better integrate existing baseband chips with their apps processor. He also believes that the company might be considering developing its own internal Wi-Fi chipset. Modoff’s comment echo JP Morgan analyst Rod Hall’s, who termed baseband chip development and design as “notoriously difficult.”

For those who don’t know, a baseband chip is an essential component in any mobile device since it allows the device to communicate over cellular networks.

This article was filed in Homepage > Apple > Cellphones and was tagged with iPhone and qualcomm.
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