Qualcomm

Motorola's Handset Strategy - Wireless Turkeys 2008

Phil Goldstein — Thu, 20 Nov 2008 09:45:44 -0500

Why is it a turkey?

Motorola started the year by confirming that it was considering spinning off its mobile devices business entirely. The company's prospects did not improve as the year went on. The first quarter saw Motorola post a $194 million loss as it shipped 27.4 million units. In the second quarter, the company posted a $4 million profit, but revenue dropped 7.4 percent to $8.08 billion, and the company's handset business continued to struggle.

In early August Motorola named former Qualcomm executive Sanjay Jha co-CEO and head its handset division. Jha was tasked with turning the flailing business around. The company's entrée into the smartphone market in the wake of the iPhone 3G was the Krave ZN4, which it billed as both a touchscreen phone and a flip phone. But excitement over the phone could not disguise problems with the company's handset strategy, and Motorola reported a $397 million third quarter loss, including an $840 million loss in the handset division. Jha said Motorola would focus on low-tier devices as well as mid-to-high tier devices based on Google's Android platform and Windows Mobile.

Yet Samsung passed Motorola in the third quarter as the top handset maker in the United States for the first time. To top off a year of bad news for the handset division, the Motorola RAZR lost its spot as the top-selling U.S. consumer handset in the quarter to the iPhone 3G, according to the NPD Group. The fact that the RAZR had been the top phone for 12 straight quarters and no other Motorola phone had been at the top laid bare Motorola's lack of innovation, especially in the post-iPhone era.

Broadcom wins round over Qualcomm in patent litigation

Jim Barthold — Wed, 19 Nov 2008 08:05:34 -0500

In the Energizer Bunny of litigation (it keeps going and going and going), Broadcom won a round in its running battle with Qualcomm over EVDO chip patent issues when a federal district court ruled that Qualcomm violated an injunction to stop using Broadcom technology or pay royalties.

Qualcomm had been allowed to continue to sell "legacy" EVDO chips until Jan. 31, 2009 as long as Broadcom got a royalty. U.S. District Court Judge James Selma decided that Qualcomm violated that agreement and ordered the chipmaker to make a full accounting of royalties to be paid to Broadcom and to chip in another 10 percent for interest.

Qualcomm was also ordered to destroy the rest of its non-legacy EVDO chips or pay Broadcom the gross profits on the sales. No doubt the ruling will be appealed and the two companies will continue a war that may only end when carriers no longer use EVDO.

For more
- see this article

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Qualcomm drops UMB, focuses on LTE

Phil Goldstein — Fri, 14 Nov 2008 10:18:08 -0500

Qualcomm announced that it was stopping its development of Ultra-Mobile Broadband 4G technology, and instead would put its focus on Long-Term Evolution (LTE) technology, as the demand for mobile phones slips.

LTE, which has been chosen by CDMA operator Verizon Wireless and many GSM operators as the 4G standard going forward, seems to have effectively killed the need for UMB. UMB was supposed to have been a technology that would have served as a handoff for CDMA 2000 technologies. But because the 3GPP2 standards added this functionality to LTE, it made UMB redundant.

Qualcomm CEO Paul Jacobs made the announcement at an analyst meeting, and did not specific any large job cuts that will come as a result of the move. Despite weakening demand, Jacobs said he still expected 25 percent growth in Qualcomm's CDMA technology in 2009.

For more:
- see this article

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Andrew Viterbi - Top U.S. Wireless Innovators of All Time

Sue Marek — Thu, 13 Nov 2008 10:14:55 -0500

While teaching at UCLA in the 1960s, Andrew Viterbi developed an algorithm that today is credited with making it possible to eliminate noise in cellular networks. The Viterbi algorithm has had a far-reaching impact and is used by all four international standards for digital cellular telephony.

Viterbi is probably best-known for being one of the co-founders of Qualcomm. In 1985, he founded the company along with Irwin Jacobs after they sold their prior venture Linkabit, a military communications firm. Currently, Viterbi is the president of the investment and advisory firm Viterbi Group LLC.

Irwin Jacobs - Top U.S. Wireless Innovators of All Time

Sue Marek — Thu, 13 Nov 2008 09:19:57 -0500

Like some of our other Top Wireless Innovators, Jacobs is a former professor, who taught electrical engineering at the Massachusetts Institute of Technology and the University of California, San Diego. In 1972, he gave up academia and founded Linkabit along with Wireless Innovator Andrew Viterbi. After selling Linkabit, Jacobs, Viterbi and a handful of others former Linkabit employees founded Qualcomm. Jacobs is credited with developing CDMA, a digital air interface technology that today is used in millions of cell phones globally.

Jacobs stepped down as CEO of Qualcomm in 2005 but remains the company's chairman.

Qualcomm: Snapdragon devices will be available in 2009

Phil Goldstein — Wed, 12 Nov 2008 10:30:47 -0500

Qualcomm is pushing its new Snapdragon chipset, which is optimized for mobile computing and mobile Internet devices. The company said there are currently 30 devices in development with the chipset--the first coming out in the first half of 2009.

Qualcomm said some of the companies it is currently working with to develop Snapdragon devices include handset makers HTC, LG and Samsung. The chipset will allow handsets to run on Windows Mobile, Google's Android platform and some Linux-based operating systems.

"Many of the customers we are now working with are new to Qualcomm and are looking to Snapdragon to help them succeed in the mobile space," said Luis Pineda, senior vice president of marketing and product management for Qualcomm CDMA Technologies.

For more:
- see this release

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Qualcomm posts higher profits, but cuts 2009 forecast

Phil Goldstein — Fri, 07 Nov 2008 10:44:08 -0500

Qualcomm posted its fourth quarter and fiscal 2008 results, and the company had higher revenues and net incomes both for the quarter and the year in total. However, it reduced its forecast for CDMA devices in 2009.

For the fourth quarter the company had net income of $1.06 billion, up 16 percent year-on-year and sequentially, and had revenues of $3.33 billion, up 44 percent from the fourth quarter last year and up 21 percent sequentially. For the fiscal year in total, the chip-maker had net income of $3.74 billion, up 10 percent year-on-year, and revenues of $11.13 billion, up 25 percent from last year.

However, because of the credit crisis and worsening macroeconomic conditions, the company expects lower growth in 2009. "While we are estimating strong growth for CDMA-based devices in calendar year 2009, driven by a shift to emerging markets, this growth is meaningfully less than we would have forecast just a few weeks ago," CEO Paul Jacobs said.

The company also noted the positive impact of the $2.5 billion non-refundable payment related to new license and settlement agreements it received from Nokia in October. "Consideration provided to us under the new license agreement with Nokia included, among other things, a non-refundable up-front payment of $2.5 billion, ongoing royalties and the assignment of patents that we recorded in intangible assets in the amount of $1.8 billion," the company said.

For more:
- see this release

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Qualcomm slapped with $1 billion patent suit

Phil Goldstein — Tue, 28 Oct 2008 10:00:09 -0400

Qualcomm is now embroiled in another legal battle over patent infringement. Gabriel Technologies filed a $1 billion lawsuit against the tech firm, claiming that Qualcomm subsidiary SnapTrack improperly appropriated intellectual property as part of a joint development agreement with Locate Networks. Gabriel says that the rights were acquired by its own subsidiary, Trace Technologies, and that Qualcomm wrongly acquired 90 separate patents by claiming ownership.

"We look forward to providing the court with evidence of Qualcomm's wrongdoing in this case," said Ronald Gillum, Jr., Gabriel's president. "We intend to vigorously prosecute this misappropriation of our valuable intellectual property."

The disputed technology revolves around assisted GPS, which helps integrate GPS technology into mobile devices.

Qualcomm has also been involved with a long-running patent dispute with rival Broadcom, which has gone through numerous arbitration decisions by both federal courts and the U.S. International Trade Commission.

For more:
- see this article

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12. Paul Jacobs, CEO, Qualcomm

Sue Marek — Wed, 15 Oct 2008 11:49:15 -0400

What makes him powerful: In July 2005 Paul Jacobs took over as CEO of the technology firm founded by his father Irwin Jacobs, a wireless industry pioneer who championed CDMA technology in the 1990s when the cellular industry made the transition from analog to digital.

Jacobs has received a lot of scrutiny over the past three years because he is Irwin Jacobs' son but Jacobs is an innovator in his own right. He has been granted more than 25 patents for his inventions in wireless technology. He insists on being judged by his ability to implement successful business strategies and drive the financial success of the company. So far, he is succeeding.

Today, a large percentage of Qualcomm's revenues come from patent royalties and sales of its CDMA chips, but those patents are being challenged more than ever before and its massive growth is becoming much harder to replicate.

The company has been embroiled in some particularly contentious patent infringement battles with firms such as Broadcom and Nokia. Earlier this year Jacobs helped Qualcomm resolve its long-standing bitter patent disputes with Nokia. The two telecom giants announced they have entered into a new 15-year patent agreement that effectively settles all litigation between the companies, including the withdrawal by Nokia of its complaint to the European Commission and numerous lawsuits filed in the U.S., Europe and Asia.

But the firm's battles with Broadcom don't seem to be going away. Last year, the International Trade Commission issued a ban on sales of some cell phones using Qualcomm chips that it found to infringe on a Broadcom patent related to phone battery saving technology. Yesterday, the U.S. Court of Appeals for the Federal Circuit vacated the ban, said hat the ITC did not have authority to issue a ban that affected cell phone makers and service providers that were not part of the original case between Qualcomm and Broadcom. This latest decision is a plus for Qualcomm but this dispute is far from over.

Jacob has no problem taking risks when it comes to business strategies. He spearheaded the BREW effort, a software platform for mobile phones that was used by Verizon Wireless and other operators.

He also fostered Qualcomm's work on MediaFLO, a nationwide mobile broadcast TV network that Qualcomm is spending $800 million to build. So far the gambit has paid off, both Verizon Wireless and AT&T are using the MediaFLO service and offering it to their subscribers. However, Jacobs has admitted that this foray into the broadcast mobile TV space has moved slower than Qualcomm wants.

Not all analysts agree with Jacob's strategies and many scoff at these initiatives but Qualcomm remains a powerhouse in the wireless industry-and that should never be underestimated.

Court ends ban on Qualcomm chips

Phil Goldstein — Tue, 14 Oct 2008 14:19:14 -0400

A federal appeals court vacated a ruling by the U.S. International Trade Commission that banned the importation of certain 3G cell phones that carried Qualcomm chips.

In a punctuation to the long-running and bitter saga over patent infringements and the importation of chips, the U.S. Court of Appeals for the Federal Circuit in Washington, D.C., also vacated part of the ITC ruling that said Qualcomm was responsible for inducing infringement of a patent for chips held by rival Broadcom that allowed phones to operate on reduced power mode to extend battery life.

The ITC ruled in 2007 that Qualcomm had forced handset manufacturers to install Qualcomm chips and battery-saving software into their mobile devices. Kyocera, Motorola, Samsung, Sprint Nextel and T-Mobile USA had backed Qualcomm in the dispute.

The court said Tuesday that the ITC had over-stepped its authority when it barred the companies from importing 3G phones with the infringing Qualcomm chips.

For more:
- see this article

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21. Steve Largent, President and CEO of CTIA

Phil Goldstein — Fri, 10 Oct 2008 15:20:39 -0400

What makes him powerful: As the head of the U.S. wireless industry's largest trade association since 2003, Largent has helped usher in a new era of wireless with an 86 percent market penetration rate. He arrived at CTIA after having served as a U.S Representative from Oklahoma from 1994-2001. While there, he was the vice-chairman of the energy and air quality subcommittee and also served on the telecommunications Subcommittee.

Of course, many people know him from his days as a pro football player with the Seattle Seahawks where he spent 14 years and participated in seven Pro Bowls.

Following in the footsteps of Tom Wheeler, the past president and CEO of the CTIA, who championed the wireless industry during its time of great growth, wasn't an easy task. Largent has had to work hard to try to get out from under Wheeler's shadow and he hasn't always been successful.

Nevertheless, since becoming the head of CTIA, Largent has helped lobby Congress and President Bush to expand the reach of the wireless industry in the United States, where there are now over 262 million wireless subscribers.

He has waded into controversies both large and small, winning on issues like the growth of networks and access to spectrum. However, he has also lost a few battles, such as when he lobbied President Bush in the summer of 2007 to block a U.S. International Trade Commission ruling that banned the importation of certain Qualcomm chips because of a patent dispute. Bush upheld the ban.

While it may seem that Largent's role is largely perfunctory--presiding over the keynote sessions at CTIA conferences for example--he has continued CTIA's role as a formidable lobbying force on Capitol Hill, akin to many other leading industries with seats at Washington's power table.

Broadcom files another complaint against Qualcomm

Sue Marek — Wed, 08 Oct 2008 11:00:17 -0400

The never-ending patent battle between Broadcom and Qualcomm wages on. Yesterday Broadcom filed a complaint in the U.S. District Court for the Southern District of California in San Diego seeking a declaratory judgment against Qualcomm because that firm's sales and licensing practices amount to patent misuse.

Specifically, the complaint said that Qualcomm's use of "exhausted" patents to control post-sale use of products results in a double recovery of royalties to Qualcomm. And it says that these practices constitute patent misuse.

Several patent cases between these two companies are still pending. These include the high-profile ITC decision last year that banned sales in the U.S of cellular phones that contain Qualcomm chips that infringe on Broadcom patents, which is still under appeal at the Federal Circuit; another case that was stayed by the Santa Ana court, which Broadcom may take to trial; as well as antitrust and litigation misconduct cases that Broadcom has filed against Qualcomm.

For more:
- see this article

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GSMA-backed group initiates mobile broadband campaign

Sue Marek — Tue, 30 Sep 2008 11:15:30 -0400

On the eve of the WiMAX World conference in Chicago, the GSMA, along with 17 mobile carriers and vendors including Qualcomm, Vodafone, Microsoft and Orange, today announced an initiative to promote the use of notebook PCs pre-installed with HSPA mobile broadband technology. Specifically, the group said they will spend about $1 billion to get a graphic service mark that says "mobile broadband" attached to HSPA-enabled notebook computers with the goal of making customers aware of which laptops have the technology.

During an interview with FierceWireless, Michael O'Hara, chief marketing officer of the GSMA, said that although no U.S. GSM operators are named in the press release, the group does believe it will have a big impact on the U.S. market. "We have a working group the represents major operators from across the world that are working on this initiative," O'Hara said.

However, Ovum Research analyst Steven Hartley questioned the need for such an initiative. In a research note, Hartley said, "Mobile broadband uptake is already growing rapidly without it. It could be argued that any promotion is better than nothing, but it looks a lot like the initiative is designed as a defense move against WiMAX branding."

For more:
- see this press release

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Qualcomm set to bring satellite connection to mobile phones

Phil Goldstein — Mon, 22 Sep 2008 10:32:13 -0400

Qualcomm has inked a deal with SkyTerra's Mobile Satellite Ventures and ICO Global Communications that will bring satellite connections to multi-mode cellular phones, the companies said in a joint announcement.

Satellite phones used to be expensive and strictly for the uber-rich. They came with extra-long antennas that enabled the caller to get a signal anywhere. With this deal, Qualcomm is saying that caricature has been relegated to the dustbin.

Qualcomm will put satellite and cellular phone technology into baseband chips embedded in multi-mode phones. This, the companies say, will both allow a wider consumer market to access satellite connectivity and enable handset makers to develop phones that are satellite-capable.

The new chips will support the L- and S-Band frequencies, in which MSV and ICO operate, and will be available beginning in 2010.

For more:
- see this release

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AT&T, Panasonic will support Qualcomm's Gobi chip

Phil Goldstein — Wed, 10 Sep 2008 09:08:53 -0400

Qualcomm just received more support for its Gobi embedded laptop chipset. AT&T has certified the technology to be used on its HSPA network along with two of Panasonic's Gobi-enabled rugged notebooks. In addition, HP's refreshed line of notebooks, which have built-in Gobi technology, are also certified for AT&T's network.

On the CDMA front, two of Panasonic's Gobi-enabled laptops received certification from Verizon Wireless for use on its EV-DO network.

Gobi allows users to switch seamlessly between 3G networks around the world, including GSM, EDGE, HSPA, and EV-DO. Vodafone, which operates an HSPA network in Europe, has backed the project, complementing partner Verizon's U.S.-based EV-DO network.

Yesterday at Andrew Seybold's Wireless University before the opening of the CTIA Wireless I.T. and Entertainment conference in San Francisco, Qualcomm's vice president of strategic products for their CDMA division, Michael Concannon, extolled the virtues of Gobi.

One of the keys to Gobi's innovative design, Concannon said, is that it standardizes API, and allows developers to develop a potentially endless variety of applications that sit above the card firmware, while providing no problem with certification.

For more:
- see this article

Qualcomm executive pushes Gobi chipset

Phil Goldstein — Tue, 09 Sep 2008 19:17:01 -0400

Michael Concannon, Qualcomm's vice president of strategic products for Qualcomm's CDMA division, revealed more details about the Gobi chipset at the Andrew Seybold University, co-located at the CTIA Wireless I.T. and Entertainment Conference in San Francisco. Concannon billed the chipset as the multimode solution to global 3G network compatibility issues.

Gobi allows users to switch seamlessly between 3G networks around the world, including GSM, EDGE, HSPA, HSDPA and EV-DO. Vodafone, which operates an HSPA network in Europe, has backed the project, complementing partner Verizon's U.S.-based EV-DO network. Concannon said the chipset streamlines notebook manufacturer supply logistics and provides mobile GPS functionality on laptops.

The concept was first announced last fall and more details began emerging about the aims of the chipset this spring. Concannon said the Gobi solution arose in response to both a rising number of 3G subscribers globally--now estimated at 630 million--as well as 3G technology not being embedded and deployed fast enough in laptops.

Concannon said consumers were forced into carrier selection at the time of purchase, and that had restricted global mobility for business travelers. In response, he said, IT managers told Qualcomm they wanted a solution that would provide easy end-user access, provide coverage anywhere they could use a cell phone, gave them investment protection and allowed for global roaming.

One of the keys to Gobi's innovative design, Concannon said, is that it standardizes API, and allows developers to develope a potentially endless variety of applications that sit above the card firmware, while providing no problem with certification.

Behind the slick marketing roll-out is a clear business model. If Gobi is adopted largescale in laptops it will give Qualcomm a foothold in an expanding market as they hope to pivot and move beyond their CDMA standard.

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Qualcomm slapped for violating Broadcom ban

Sue Marek — Fri, 29 Aug 2008 10:22:40 -0400

The Qualcomm, Broadcom patent saga continues. Yesterday a Santa Ana, Calif., federal judge ruled Qualcomm violated an injunction on the use of Broadcom patents and he ordered the company to pay royalties on certain QChat push-to-talk revenue.

In the ruling, U.S. District Judge James Selna said there was "clear and convincing evidence" that Qualcomm was in contempt of a Dec. 31 order that he issued to prevent the company from infringing on three Broadcom patents. In May 2007 a jury found Qualcomm had infringed on the three Broadcom patents and it awarded $19.64 million in damages for past infringement in the case.

Qualcomm says it has already moved to a new version of the QChat software and wireless phones that no longer infringe on the patents. However, the company would not say how many wireless phones would be affected by the judge's order, nor would it provide an estimate of how much money the company owed to Broadcom for the profits from its QChat product line.

For more:
See this article

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Qualcomm working on Android platform

Sue Marek — Mon, 04 Aug 2008 10:54:22 -0400

Qualcomm confirmed that it is working on a mobile phone platform that will be based on the Android operating system. During an analyst conference in San Diego last week, Qualcomm executives said that the company anticipates a large number of Android phones will run on Qualcomm platforms.

Qualcomm is a member of the Open Handset Alliance, which promotes the Android platform. In addition, Qualcomm and several other manufacturers exhibited Android-based prototypes or proof-of-concept devices at the annual Mobile World Congress industry conference in Barcelona last February.

For more:
- read this article

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Jha to head Motorola devices unit

Sue Marek — Mon, 04 Aug 2008 10:40:27 -0400

After months of speculation, Motorola has named Sanjay Jha CEO of its ailing mobile devices division. Jha will also be co-CEO of Motorola, sharing the responsibility with Greg Brown.

Jha, a well-known wireless industry executive, was considered a rising star at Qualcomm where he was the firm's COO. He joined Qualcomm in 1994. Len Lauer, Qualcomm's executive vice president and group president, will replace Jha as COO.

Analysts responded favorably to the news. Avian Securities Analyst Matt Thornton said that establishing new leadership in Motorola's handset business should help improve morale and slow the exodus of talent in the ailing division. In addition, Jha's experience will likely prove valuable as he tries to turn the unit around.

For more:
- see this article

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Qualcomm, Nokia reach new patent agreement, end years of bitter disputes

Lynnette Luna — Thu, 24 Jul 2008 04:30:21 -0400

The many bitter patent disputes between Qualcomm and Nokia have finally ended. The two telecom giants announced they have entered into a new 15-year patent agreement that effectively settles all litigation between the companies, including the withdrawal by Nokia of its complaint to the European Commission and numerous lawsuits filed in the U.S., Europe and Asia. Nokia filed a complaint with the EC in October 2005 with five other companies, which led to a flurry of lawsuits between Qualcomm and its rivals and several regulatory probes into Qualcomm's licensing practices. The two were also miles apart for some time when it came to renegotiating a new license agreement that expired in April 2007.

The new deal comes on the day Qualcomm and Nokia were to appear in a Delaware court to begin a key trial over WCDMA patents, but the judge had delayed the trial by a day. Nokia claimed Qualcomm charges too much for the patents. Nokia now has been granted a license under all of Qualcomm's patents for use in Nokia mobile devices and Nokia Siemens Networks infrastructure equipment. The agreement covers a number of technology standards, including GSM, EDGE, CDMA, WCDMA, HSDPA, OFDM, WiMAX, LTE and others. Nokia also agreed not to use any of its patents directly against Qualcomm, enabling Qualcomm to integrate Nokia's technology into Qualcomm's chipsets.

The financial structure of the settlement includes an up-front payment and on-going royalties payable to Qualcomm. Nokia has agreed to assign ownership of a number of patents to Qualcomm, including patents declared as essential to WCDMA, GSM and OFDMA. The specific terms, however, are confidential.

Qualcomm investors breathed a sigh of relief, pushing the company's shares up 18.7 percent in after-hours trading.

Qualcomm delayed the release of its fiscal third-quarter results for several hours to announce the agreement with Nokia. The company's profits fell 6 percent to $748 million, or 45 cents a share, for the three months ended June 29, down from $798 million, or 47 cents a share, the previous year. Revenue grew 19 percent to $2.76 billion from $2.33 billion.

For more:
- read AP
- see this release

Related stories:
Nokia gains patent victory over Qualcomm in Germany. Nokia patent story
Nokia, Qualcomm head to court this week over CDMA patents. Nokia/Qualcomm story
Qualcomm-Nokia lawsuits continue to fly. Lawsuit story
Nokia sues Qualcomm in Europe. Nokia-Qualcomm story