Qualcomm Thrives Amidst the Dominant European Mobile Presence

Two blogs I read carried some coverage on the LTE IPR agreement that I wrote about here.

GigaOM pointed out that there will be a push-pull effect with the IP developers on one side and the operators and handset vendors on the other. But, it is perhaps unfair to characterize Qualcomm's (QCOM) IP position as the cause of 'pain and suffering'. I can see why other companies are seething at Qualcomm’s demands – the company takes a large chunk of their margins. But then, it makes sense from Qualcomm’s perspective and even for the telecom industry as such.
If there is one US company that is thriving and very successfully holding its own amidst the dominant European presence in the mobile space, it is Qualcomm. It is the high margin IP-based revenue that has allowed the company to get here. The company diverts this revenue back into state-of-the-art research that advances mobile communications. At least that is its business model and that is what the others are trying to break through the legal battles.

Dean Bubley also had some good points that I concur with. The IP-rich companies are ominous in their absence. Besides, it is a good way of positioning LTE as the fore-runner in the 4G race. Like he says, it will be interesting to see how the WiMAX world reacts to this.

Talking of WiMAX, did anyone notice Nextwave (WAVE) in this list? What is a company that put its weight behind WiMAX not long ago doing here? Does it say something about the future of WiMAX or the winner in the 4G race?

Disclosure: Long Qualcomm at the time of writing

Comments

[globalmacro]

NextWave's HQ is right down the street from my office. I've spoken with one of the top executives at the company and it seems like there might be some potential there. Can you write an article about your take on the company? It would be much appreciated.

[VijayNagarajan]

GlobalMacro,

I do have some coverage on Nextwave dating back to June 2007 in my blog. You can check it out here -

wirelessanalyst.blogsp...

I will do an updated article sometime in the near future. You could leave your comments and specific questions on my site and I will try to answer them.

Vijay

[globalmacro]

Nice pop on WAVE due to the proposed sale of their spectrum. The basis of my interest was the fact that the total value of the company seemed to be equal to the value of the spectrum. So, I guess we'll see if their business strategy has any real merit.

[VijayNagarajan]

I agree. If they sell the spectrum, then they will become a chipset/IP company. And that means they will be competing with leaders in both the WiMAX and LTE space (for which they seem to be base-station side solutions.) I think it is time to get my NextWave post out.