'QualSoft' the next force in the mobile multimedia battle?

Other Qualcomm developments

Also last week, Qualcomm claimed the first commercial chipset supporting HSUPA (High Speed Uplink Packet Access), an extension of the W-CDMA standard that speeds upload data rates and should be deployed by 3G operators in 2007 onwards.

The MSM7200 chipset is targeted at low latency applications such as multiuser gaming, push to share and VoIP and supports the Multimedia Broadcast Multicast service (MBMS), the standard for television over 3G networks.

The MSM7200 offers downlink speeds up to 7.2Mbps and 5.76Mbps on the uplink, says Qualcomm, and so competes with wireline broadband speeds. The new chipset is part of Qualcomm’s Convergence Platform of dual-core solutions, aimed at advanced multimedia applications.

At the other end of the handset scale, and seeking to counter perceptions that CDMA is a high cost solution because of the patents costs, CEO Paul Jacobs told last week's analyst day that CDMA phones are winning in low cost markets like India, even in the sub-$50 category.

Indeed, the chipmaker raised its third quarter earnings forecasts last week largely on the basis of better than expected sales of low end models, saying the company's per-share earnings should range between 38 cents and 40 cents, up from an earlier estimate of 36 cents to 38 cents. Revenue should meet or exceed the high end of earlier guidance of $1.77bn-$1.87bn.

While the GSM Association’s Ultra Low Cost Handset programme has focused on the economies of scale that the huge GSM market enjoys, its counterpart, the CDMA Development Group, argues that aggregating the features and options so that manufacturers only have to build to one particular core design is the key to low cost handsets.

In 2005, the bill of materials cost for a low end handset was about $39, according to IC Insights, and phonemakers believe they can get that below $25 this year.

Also at the analyst day, president Steve Altman said a settlement is "likely" in the company's ongoing royalties dispute with Nokia, which has joined five other mobile manufacturers in filing anti-trust complaints with the European Commission.

Earlier in the week, CEO Paul Jacobs described ongoing license agreement negotiations with Nokia, which the company had previously warned could hit difficulties, as the most significant challenge facing the company in the coming months. The agreement expires in April 2007.

Flarion patents

Qualcomm’s recent statements have been designed to convince the markets that it has a strong patents hoard in OFDM, and one that is likely to impact on WiMAX.

The latest strike comes in the shape of a $205m payment to former shareholders in Flarion, which Qualcomm acquired for its OFDM technologies in January for $600m, already a high price for a start-up whose revenues were estimated at less than 5% of that figure.

At the time, a further $200m was built into the acquisition deal based on future performance, and this pay-out has now been triggered by the issuance of new patents to Flarion.

"The rapid issuance of these patents is yet another indicator of Flarion's strength as an OFDMA innovator and further enhances Qualcomm's leadership position in the wireless industry," Qualcomm president Steven Altman said in a statement.

Copyright © 2006, Wireless Watch

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