SAN DIEGO, CALIF.—It's been a long time since I've visited Qualcomm's (NASDAQ:QCOM) headquarters for a technology demonstration, and I wasn't the only one harkening back to the days when the company had to prove its technology is better than others.
Qualcomm's current CTO, Matt Grob, remembered those days as well during a Q&A session with reporters as part of a Qualcomm "Setting the Record Straight about LTE Unlicensed and Wi-Fi Coexistence" event with members of the media Wednesday. Ironically, or perhaps not, the event was on the same day that Qualcomm and other members of the LTE-U Forum, including Verizon (NYSE: VZ), Ericsson (NASDAQ: ERIC) and Alcatel-Lucent (NYSE: ALU), as well as T-Mobile US (NYSE:TMUS), sent a letter to the FCC chastising the Wi-Fi Alliance for asking the FCC to hold off on certifying LTE-U equipment until it is fully satisfied that fair sharing of unlicensed spectrum will be achieved.
The way LTE-U Forum members interpret it, the Wi-Fi Alliance is trying to be the "self-appointed gatekeeper of unlicensed spectrum," one where the alliance would decide what types of new technologies get introduced into the world, a move that in their view flies in the face of innovation and the regulatory regime itself.
The Wi-Fi Alliance isn't alone in its concerns about LTE-U. The National Cable & Telecommunications Association (NCTA), Google (NASDAQ: GOOG), Microsoft (NASDAQ: MSFT) and Cisco also have registered their concerns with the FCC to varying degrees, with Google's mighty heft carrying considerable clout. Organizations like Public Knowledge also have talked about Qualcomm's strong patent licensing incentives and potential for promoting carrier-based technologies in a way that crowds out or disadvantages Wi-Fi, a notion that Qualcomm has flat-out rejected.
Back in the day, Qualcomm had something to prove when GSM was considered "the" technology for cellular, pushed mainly by Europe, and the U.S. industry underwent some heated debates in the '90s when newly awarded PCS licensees were deciding which technology to roll out. A lot of U.S. cellular industry pioneers were proud that the U.S. government was not going to dictate which cellular technology was to be deployed. Unlike the Europeans, the U.S. was going to let the free market decide.
Decide it did. Spectrum licensees lined up, ticking off their choices. They were often asked: CDMA or GSM? A lot of smaller operators opted for GSM because it was a proven technology and it provided the economics of scale that comes when more than one operator deploys a technology. The more that bought into it, the more the vendors earned and the more they were willing to build for it, and price it accordingly. CDMA, on the other hand, had to climb and scale that mountain step by step, with the CDMA pioneer Qualcomm at the helm.
So it's not that surprising that years later, what was one of Qualcomm's biggest CDMA customers is also part of the battle for LTE-U. Verizon sees big benefits from rolling out LTE-U, mainly what it describes as better working Wi-Fi, or as I would summarize, "better working everything," in their view.
Qualcomm survived the wars of 2G, W-CDMA, CDMA 2000 and UMTS, and the message from CTO Grob this week was that Qualcomm cares very much about co-existence when it comes to Wi-Fi and LTE. It's got engineering teams dedicated to both, and they're working with one another to make it better. Qualcomm also makes a lot of money off of both, and heck, if you can combine them and make everything work better, with faster mobile connections, why not?
It should be noted that Qualcomm doesn't always make the right bets when it comes to technology and business ventures. Remember MediaFlo? That TV service that was supposed to be such a hit with consumers -- and Verizon was part of that project early on -- but it never managed to succeed and was shut down in 2011.
Yet Qualcomm has a solid history of evangelizing technologies when it believes in something and it has got that surging throughout its DNA. Qualcomm and its backers were strong enough to ascend the mountain and declare victory in CDMA when it had to battle the entrenched GSM community, which was nothing to balk at. Now Qualcomm and its fellow LTE-U members are battling the likes of Google and the cable industry.
Entering Qualcomm's facilities in San Diego, I was struck by the wall of patents that greets visitors as soon as you walk in the door. Indeed, it has been a long, long time since I first visited Qualcomm's facilities, back when it still had a lot to prove as an upstart in cellular technology. It will be interesting to see what happens to that patent wall when it comes to LTE-U.--Monica