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verne arase said:

Apple is currently buying modems from Qualcomm - shouldn't the IP be baked into the chipset as purchased from Qualcomm?

They're certainly paying Qualcomm enough for the chips and licensing.

Qualcomm only includes their patents and chipset as part of that package, 5G have a few other major contributors such as Nokia, Ericsson and Samsung. Just to name a few everyone should have heard of. 

Samsung received estimated $683M ( revenue ) payment from Apple in Q2, still projects 56% decline in profits

Samsung on Friday released a bleak earnings forecast for its second fiscal quarter of 2019, projecting operating profits more than halved from last year due to ongoing weakness in the company's bread-and-butter memory chip business.

Operating profit likely dipped to 6.5 trillion won (about $5.5 billion) 

Well Done AI.

rob53 said:

With Infineon wireless technology and patents I could see Apple working on the next version of cellular, 6G or whatever they want to call it. They could bypass Qualcomm and the others and have a ”free” cellular network for iOS users, thereby justifying the cost of the most secure mobile devices on the market. 

Um.... that is not how it works.

knowitall said:

I would be worried about quality.
I they couldn't deliver while part of Intel, why would they be able to when bought by Apple?

For a lot of reason. One being Intel wanted to use their own Fab for modem, but Intel has Zero experience in Fabbing Modem, which is a whole lot of different to GPU or CPU. Their Custom Foundry aren't anywhere near as good as TSMC or even Samsung. They force the change to using x86 core, their own FPGA within the modem, which Apple will not be acquiring, and complicate things a bit. I believe the coming 7660 modem should be able to show whether Intel really is capable or not.  

And the 2nd reason, it wasn't Intel was bad, it was Qualcomm that was WAY too good.

Metriacanthosaurus said:

It’s always the same story. Our puny minds can’t comprehend the expenses Apple has. Well, every company has expenses that are not materials cost. Is that really the customer’s burden to bear? I think what customers want is for some of that past R&D to start to amortize, and result in stable product lines. This unpredictable continuous rise in prices for no compelling reason has everyone concerned. 

Meanwhile, our puny minds can comprehend the balance sheet, and profit is obscene. The same old story doesn’t fly. 

Dont get get me wrong I think it’s perfectly fine for Apple to have a wide line of iPhone, but they’ve pushed the envelope on what a flagship model can cost and they’re not doing anything they weren’t doing 5 years ago when a flagship iPhone was $650. 

TL;DR -  Innovation is getting more expensive.

It is not unpredictable. It has been the case ever since we finally see the end of Moore's law. It is just most people 1. Did not bother to google and known enough about the topic, 2. Media did an absolutely appalling job, not only did they not understand it themselves, they didn't bother to report it since it is not click baiting enough.

Ever since the Smartphone Revolution, which kicks off a whole lots of other advancement in every computing industry ( or arguably in every industry ), the engineering cost of components and products has been steadily rising. From the Machines that design and Manufacturer the Chips, Engineers wages that has sky rocketed, to Tools required for QA and design, every single part of the process has shoot up in price. That is not including the fact R&D are getting harder as we reach some fundamental limits. It is likely to cost $1B to Fab an TSMC 5nm Chip. That is excluding the cost to ARM and other IP Price. You can literally count with your fingers Companies that has this budget and a market to sell these chips.

Consumer don't see these price increase because most of these R&D were spread to a much larger usage base, 1.3B Annual Smartphones sales compared to ~250M PC, a total of 10-100x increase in Global Mobile Revenue that drives the innovation in 4G and 5G as well as other advancement in the backend. Because the market were so much larger these technologies manage to recoup their R&D and made a handsome profits while charging you tiny amount of money.

But now the Smartphone Market has reached the end of its growth curve and a stage of saturation. Smartphone has reached roughly 80% of the total addressable market, that is world population minus infants and elderly. With the rest concerning more about Food and Water. Smartphone cycle are now longer than 3 years, and trending towards 4. There will be less Smartphone sold every year. ( And one reason why the media and marketing are trying to hype up 5G to force a upgrade cycle )

So what used to be an $1B R&D that spread over 400M iPhones in 2 years time, will now cost $3B R&D that spread over 300M iPhones in 3 years time. That is $0.25 / Unit as compared to  $1 / unit. The numbers are not absolute, they just shows the scale of differences. ( The 400M unit were with respect to most of the early iPhones sold were cutting edge model, the recent iPhone has a much wider spread on older model, which means R&D cost on leading model and spread over a lower volume )

Of Course some of these are over simplified. For example with a 5% decline on Smartphone unit sold causes an avalanche to NAND and DRAM Price ( No, there isn't a cartel in recent NAND and DRAM pricing despite what ever that makes you believe ) Display Prices from OLED and LCD are dropping fast as well due to capacity needed to fill. So some of these will off set the cost of rising R&D. But as a general trend, Tech innovation is only going to get more expensive, and the industry now worries at their 5G investment will take longer to recoup. 

The One MacBook Air problem that makes the 2018 not worth buying.

Butterfly Keyboard.

( And non active cooling, making this a 7W TDP machine vs the old 15W )