Behind the breakup between Qualcomm and Apple, what exactly is the baseband chip?

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In a document filed on September 25 in the California Superior Court in San Diego, Qualcomm accused Apple of stealing a large amount of confidential information and trade secrets and sharing them with Qualcomm's competitor Intel to improve its chip performance. This is also part of Apple's plan to reduce its dependence on Qualcomm technology.

Qualcomm made the allegations in a filing seeking an amendment to its November lawsuit, which sued Apple for violating a software licensing agreement that allowed rival Intel to profit from making broadband modems.

Then let's learn about the baseband chip. Let's talk about the baseband first. The baseband is a circuit in the mobile phone, which is responsible for completing the demodulation, descrambling, despreading and decoding of wireless signals in the mobile network, and passing the final decoded digital signal to the upper-level processing system for processing.

The baseband chip is used to synthesize the baseband signal to be transmitted, or decode the received baseband signal. Specifically, when transmitting, the audio signal is compiled into the baseband code for transmission; when receiving, the received baseband code is decoded into the audio signal. At the same time, it is also responsible for the compilation of address information (mobile phone number, website address), text information (SMS text, website text), and picture information. The baseband chip consists of: CPU processor, channel encoder, digital signal processor, modem and interface module.

The main reason why Apple does not develop this technology is that Apple has few patents in the field of mobile communications, and does not make network-side equipment or chips. Developing baseband chips by itself requires huge investment, and it also has to pay patent fees. It is better to purchase plug-ins directly.

Although Qualcomm and Intel have disputes, they have similar histories of success. Intel, founded in the late 1960s, and Qualcomm, founded in the 1980s, were born in different years but had similar opportunities and reached similar peaks in life.

Qualcomm's first contract was with the U.S. military to research CDMA technology. But that wasn't its only focus. In 1988, Qualcomm released the OminiTRACS satellite-based data communications system to enable trucking companies to track and monitor their fleets. But it was the CDMA demonstration they gave to 50 wireless industry leaders in 1989 that really set the direction for Qualcomm.

In 1993, Qualcomm was able to demonstrate its data services through CDMA, which paved the way for better mobile network connections. The Telecommunications Industry Association of the United States adopted CDMA as the cellular network standard, and Qualcomm soon began supplying network infrastructure and chips to partners and licensing its technology. By 1999, the International Telecommunication Union selected CDMA as the technology behind 3G (third-generation wireless networks).

In 1998, the world's first CDMA smartphone was born, the pdQ, jointly developed by Qualcomm and Palm. This device was basically a PalmPilot and a mobile phone combined. It was not only large but also expensive. But the rise of mobile phones with Internet capabilities began.

Qualcomm is very good at designing, manufacturing and selling integrated chips, and they also provide software services for mobile phones and wireless networks. Extensive research has allowed Qualcomm to accumulate a large number of patents, and they have also obtained more from other companies.

In 2000, Qualcomm integrated GPS into its multimedia CDMA chips and system software, combining GPS with Internet, MP3 and Bluetooth capabilities. In the following years, Qualcomm's chips gained more capabilities, including significantly increased processing performance and improved power management, which ensured that they became the world's leading mobile chip provider in 2007.

Intel belatedly decided to acquire Infineon's wireless business for $1.4 billion in 2010 to enter the long-coveted mobile phone market. However, we only see Intel's thriving growth in mobile CPUs, but rarely hear Intel publicly describe and plan its own baseband products.

In fact, Infineon's 2G baseband before the acquisition has been widely used in Nokia's Asha series, and the XMM6260/6360 3G baseband after the acquisition is also used in the international version of Galaxy S4; the first multi-mode LTE baseband XMM7160 has been released for half a year and integrated into Samsung's Galaxy Tab 3 10.1.

XMM7160 is manufactured using TSMC's 40nm CMOS process, and the matching SMARTi 4G transceiver uses TSMC's 65nm process. Its publicity highlights are that the power consumption is 20-30% lower than that of competitors' solutions. In addition, the transceiver supports many ports, and each device can have up to 15 LTE bands, which is one of the multi-mode and multi-band LTE solutions with the lowest power consumption and smallest footprint.

Intel XMM7160 can provide seamless switching across 2G, 3G and 4G LTE networks and has LTE voice capabilities. It uses a highly configurable RF architecture and runs real-time algorithms with envelope tracking and antenna tuning, which enables cost-effective multi-band configuration, extended battery life and global LTE roaming in a single mobile terminal configuration.

It is a pity that XMM7160 does not support TDD-LTE and TD-SCDMA. It may be enabled with the 7162 coprocessor in the future. Currently, it seems to be only used in a few tablet products and its market acceptance is not very high.

As for Intel's second-generation LTE multi-mode baseband "XMM7260", we have only learned some rough information so far, including that the new product will be manufactured using TSMC's 28nm process, will be compatible with Cat. 6 300Mbps, and will be equipped with a new, also 28nm process transceiver to support carrier aggregation, and will add 5-6 ports, bringing the total to 20-21.

Qualcomm has been maintaining this two-front strategy, licensing patented technologies while using its own advanced chip products to seize the market and guide the direction of technology. In this way, not only are the chips the best and most advanced in the market, but the technology research and development is also at the forefront. Even if Qualcomm Snapdragon is not used, it is forced to use Qualcomm's patents, otherwise it will be bullied by both terminal manufacturers and telecom operators. The poor signal and severe heating of Meizu in the early years were due to this. Now Huawei HiSilicon, which boasts a lot, must also use Qualcomm patents, and Qualcomm has invested heavily in developers. Huawei is not as good as Qualcomm in chip compatibility.

Qualcomm's main revenue comes from two parts: patent licensing and the sale of mobile phone baseband chips (core chips responsible for wireless communication functions).

If mobile phone manufacturers use Qualcomm chips, they have to pay for the chips and patent fees.

If equipment manufacturers use Qualcomm patents when building base station chips, they must pay patent fees.

For operators, on the one hand, they need to purchase customized phones from mobile phone manufacturers; on the other hand, they also need to purchase equipment produced by equipment manufacturers, and indirectly have to pay two patent licensing fees.

To put it bluntly, Qualcomm is "taking all three" and leaving no one alone. It is no wonder that Apple is abandoning Qualcomm and switching to Intel. As for whether Intel has infringed its patents? Apple and Qualcomm have always been engaged in a "war of words", and Intel has not made too many comments. According to their style, they rarely speak out on such incidents. Interestingly, Intel officials recently made a rare statement on this ruling. The official published an article titled "Qualcomm's Sophistry Exposed", written by Steve Rodgers, Executive Vice President and General Counsel of Intel Corporation, refuting Qualcomm's series of actions on this incident.

The article was published, but the infringement still exists. A judge at the U.S. International Trade Commission ruled that Apple's iPhone did infringe one of Qualcomm's three patents. Although Apple will not be banned from selling the phone, Intel's statement is indeed untenable.

Since the explosion of smartphones in 2010, the mobile phone baseband market has undergone several major changes in the past eight years, including the entry of Huawei HiSilicon, the short-lived success of Marvell, and the withdrawal of Broadcom.

In the 4G era, Qualcomm dominated the mobile phone baseband market. However, with the approach of 5G, the market structure of smartphone baseband chips is brewing a huge change. Apple stopped using Qualcomm, Intel took over as a substitute, and Altair, HiSilicon, Sequans and Samsung are also growing steadily. It is unknown whether Qualcomm will still dominate in the end.

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