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Qualcomm plans to rev up struggling lines

Posted: 08 Jul 2010 ?? ?Print Version ?Bookmark and Share

Keywords:Qualcomm Brew OS? mobile OS? processor? Wi-Fi? mobile TV?

Qualcomm Inc. is currently riding high on its traditional cellphone chip products amid strong demand and constraints.

During the company's Uplinq developers' forum, Qualcomm launched a number of new initiatives for many of its lesser-known products. But some of those wares!such as its Brew OS technology, the MediaFlo mobile TV line and Snapdragon chip products!are either lagging or losing steam.

The company also hopes to jumpstart!and generate some new business!for its embryonic efforts in 3D chips, augmented reality, MRAM, peer-to-peer and other newfangled technologies.

Qualcomm is rushing into new markets for good reason: It needs some new engines for growth beyond its traditional cellphone chipset business. That has not been easy, as it is struggling to expand beyond its core market.

For example, Qualcomm may unload or restructure its ownership in MediaFlo amid lackluster sales, according to reports at Uplinq. On the IC side, Qualcomm has been shipping Snapdragon, a chip line for mobile Internet devices (MIDs). Snapdragon is gaining some traction in limited smart phone designs, but the chip is "late to the party" and behind Texas Instruments Inc. and others in the MID chip space, said Will Strauss, president of Forward Concepts Co.

Another concern is Brew, Qualcomm's software platform that is billed as an OS for mobile devices. Some see a shakeout in the mobile OS world and Brew could be on the outside looking in!or one of the losers!especially as the development community embraces its rivals, such as Apple's iOS, Android, among others. Brew is still viable and has generated a lot of traction, "but only in CDMA," Strauss said.

However, the tide is turning in favor of Brew, said Paul Jacobs, president and CEO of Qualcomm. "We're getting a lot more support" for Brew, Jacobs told EE Times in a brief interview. AT&T, China Telecom, Korea Telecom, Verizon and others have endorsed or renewed their efforts with Brew, he said.

In another positive development, Qualcomm's cellphone chip business is robust right now. "There is a lot of demand," he said. "We have supply constraints."

Qualcomm had a somewhat sluggish start in its 2010 campaign. In 2009, the company was ranked as the world's sixth largest chip maker, up from eighth place in 2008, according to Gartner Inc. It had sales of $6.49 billion in 2009, down 1 percent over 2008.

But Qualcomm slide from eighth to 12th place in the rankings for the first quarter of 2010, according to iSuppli Corp. For some time, the average selling prices for Qualcomm's baseband chips have fallen amid competition from Broadcom, Infineon, MediaTek and STMicroelectronics.

In the June quarter, the company has regained its momentum. Royalty revenues are up. And shipments for the company's MSM cellphone chip line is "strong at 93 million (to) 100 million" units, up from 93 million in the previous period, said Mark McKechnie, an analyst with Gleacher & Co., in a report.

That's not what worries analysts, carriers, developers and OEMS, however. Qualcomm will likely remain the leader in the baseband market. At Uplinq, many were likely having the same thoughts: What will happen to Brew, and, to a lesser degree, Snapdragon?


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