Analysts at Detwiler Fenton are claiming that Apple will use a Qualcomm Snapdragon processor in the widely rumoured “low cost” iPhone, that will be hosted in a polycarbonate body, Forbes is reporting. Since Apple already uses a number of Qualcomm components in the iPhone, going for a complete SoC solution would significantly cut the costs.
In a research note, Detwiler analysts claimed that by using a Qualcomm processor with integrated Bluetooth and WiFi, Apple can consolidate three discrete chips used in the current iPhone 5 into a single chip at much lower cost. The deal will also be a big win for Qualcomm whose so far business with Apple has been limited to modem parts only. The research firm said that an integrated chip for a low-cost Apple iPhone could provide an incremental up to $15 per unit to Qualcomm.
“It is likely that the work with QCOM is being driven by AAPL’s concern regarding maintaining gross margins as well as the need to differentiate the product by performance,” the research firm (which shuns putting the spotlight on particular analysts) said in a research note. “AAPL would not want a value priced iPhone to offer the same kind of graphics and video support, processing power etc. that its premium priced device would, therefore a less powerful lower-end Snapdragon integrated solution would help segment the product.”
The investment house also added that Qualcomm is at no risk of losing the model business in the next refresh of the iPhone.