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Intel Corporation Begins Shipping XMM 7480 to Apple Inc.

In a month or two, Apple (NASDAQ: AAPL) is expected to unveil its next-generation iPhone models. The current rumors -- and I'd say they're quite credible at this point -- point to the release of two direct successors to the current iPhone 7 and iPhone 7 Plus smartphones with similar screen sizes and form factor, as well as a premium iPhone model with a radically different form factor, an OLED display, and more.

While the devices haven't launched yet, component suppliers need to be shipping parts to Apple's contract manufacturers now so that phones can be assembled ahead of the launch.

Image source: Apple.

On Intel's (NASDAQ: INTC) July 27 earnings conference call, company management confirmed that it had begun shipping its latest cellular modem, known as the XMM 7480, to customers. Since Intel's only serious cellular modem customer is Apple, it's a virtual certainty that Intel is now shipping modems in support of the upcoming iPhone models.

Here's what you need to know about the XMM 7480 and what it'll ultimately mean for the coming iPhone models.

Faster download and upload speeds

Apple's iPhone 7-series smartphones use either the Intel XMM 7360 cellular modem or the Qualcomm (NASDAQ: QCOM) Snapdragon X12 LTE modem, also known as the MDM9645.

Intel's XMM 7360 modem supports up to 450 megabits-per-second downlink speeds and up to 100 Mbps uplink speeds. The Snapdragon X12 supports up to 600 Mbps download speeds and 150 Mbps upload speeds.

Since the XMM 7360 modem is inferior in capabilities to the Snapdragon X12, it's believed that Apple has intentionally throttled the performance of the cellular subsystems in the Qualcomm-based iPhone 7 models to match the capabilities of the Intel chip.

It looks like Apple won't have to throttle the Qualcomm chip this year. Intel's XMM 7480 supports 600 Mbps downlink speeds and 150 Mbps uplink speeds, which, on paper, matches the capabilities of the Snapdragon X12 modem.

Apple should be able to advertise significantly higher wireless speeds compared with the previous-generation iPhone models as a selling point for this year's models. In addition, Apple's marketing team could choose to compare the cellular capabilities of this year's models to the capabilities of the iPhone 6-series and 6s-series devices to try to spur upgrades.

Intel also says the XMM 7480 uses "up to 15% less power consumption versus Intel's previous-generation LTE Advanced modem." The power reduction should allow Apple to either increase battery life or increase the speeds of other components of the new phone while maintaining similar battery life, generation over generation.

Considering that third-party reviews of Apple's iPhone models often cite battery life as a sticking point -- particularly the 4.7-inch models, which have smaller batteries than the 5.5-inch models -- I'd imagine that Apple will take the battery-life savings.

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Ashraf Eassa owns shares of Intel and Qualcomm. The Motley Fool owns shares of and recommends Apple. The Motley Fool owns shares of Qualcomm. The Motley Fool recommends Intel. The Motley Fool has a disclosure policy.