Acquiring Decawave, Qorvo Is Second Major Maker Of Location Chips With Technology Apple Is Mainstreaming

Jan. 30, 2020 11:17 AM ETQorvo, Inc. (QRVO)AAPL, INTC, NXPI12 Comments8 Likes
Bruce Krulwich profile picture
Bruce Krulwich
384 Followers

Summary

  • Chipmaker Qurvo is acquiring Decawave, maker of innovative UWB chips for highly accurate indoor localization.
  • Qorvo will be the second major chipmaker making chips for UWB, recently adopted by Apple. Qorvo is a big supplier of other chips to Apple.
  • UWB chips are likely a big part of the future of location-enabled electronics.
  • While the acquisition price was not announced, I estimate the price to be between $400M and $500M. Decawave is the latest of over 25 indoor location companies to be acquired.

For sixteen years Decawave, based in Ireland, has been developing, promoting and selling chips for ultra-wideband, also called UWB. After years of trailblazing the UWB market as a small privately held company, it was announced Wednesday that Decawave will be acquired by Qorvo (NASDAQ:QRVO), a major American chipmaker focusing on RF (radio) solutions.

UWB is a radio technology that can measure distance and location very precisely. Its accuracy reaches 5-10 centimeters, compared to several-meter accuracy that is generally achieved using Wi-Fi or Bluetooth. UWB based systems are used to monitor locations of people, equipment, robots, vehicles and other things that move around indoors, where GPS is unavailable. These systems are increasingly used in places like factories, hospitals, stores, offices, casinos, and more. UWB is also used to measure distance and location outdoors when more accuracy and reliability is needed than can be provided by GPS. In addition to dedicated localization solutions, UWB has been embedded in other devices such as robots and drones, and is driving location awareness in the growing Internet of Things (IoT) market.

Most recently, Apple (AAPL) announced in October that they will include UWB technology in their upcoming iPhone models. While they did not detail what this UWB capability will be used for, the list of potential applications is nearly endless. One use, clearly, is for UWB-powered real-time location systems to monitor locations of iPhones. But much more exciting uses come when UWB-enabled iPhones can work in concert with UWB chips in other devices. If mobile payment consoles are UWB-enabled, for example, they can ensure that they are only communicating with phones within a precise distance of the checkout, to reduce hacking and fraud. UWB enabled drones (such as an indoor aerial entertainment system from Intel (INTC)), robots (such as one from iRobot) and autonomous vehicles (such as a new Segway vehicle with follow-me functionality) can track their locations relative to an owner's smartphone much more accurately than can be done with other technologies. UWB is also being explored for smartwatches, wearables, door locks, car fobs and much more.

Because of the wide range of UWB uses, Apple's "stamp of approval" on UWB is expected to propel UWB into the mainstream. This is likely to include other smartphone makers copying Apple and including UWB in their devices, and more importantly will include integration of UWB in location-aware electronics, wearable devices, and more.

Until now, the only major public chip maker that sells UWB chips is NXP (NXPI). Decawave has been the biggest evangelist for UWB, along with other private companies including Time Domain and BeSpoon. While each vendor's chips have advantages, Decawave's product line is particularly mature, having been through several generations of development. Decawave's chips are also very small, fitting for use in wearable devices and other small things, and they include support for angle-of-arrival and other advances not yet common in other UWB chips. Decawave's acquisition by Qorvo moves the power of Decawave's UWB into the hands of a major public company.

While the price of the Decawave acquisition is not being disclosed, I have predicted before that it would be higher than other indoor location related acquisitions to date. The highest acquisition price estimate reported in this report by Grizzly Analytics (a company I founded) is $140 Million, and I estimate the Decawave acquisition to be between $400 Million and $500 Million, based on comparison with recent acquisitions in the indoor location area and in the chip industry in general. This follows the trend of chip makers paying high prices for indoor location technology, as the market for these chips explodes. But note that this is only an estimate, and the actual acquisition price is as of now a secret.

In the upcoming months I expect we will hear about new devices coming to market with UWB chips from Qorvo and NXP, hopefully compatible with the UWB in the upcoming iPhones and designed to interact with UWB in phones. We will also likely hear of other phone makers copying Apple's lead and integrating UWB into their lineups. Most importantly, we will see new UWB applications that have not yet been conceived, made possible by mainstream adoption and growing out of the technology's general availability.

This article was written by

Bruce Krulwich profile picture
384 Followers
Founder of Grizzly Analytics. Now Director of Data Analysis at Seeking Alpha.
Follow

Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.

Recommended For You

Comments (12)

To ensure this doesn’t happen in the future, please enable Javascript and cookies in your browser.
Is this happening to you frequently? Please report it on our feedback forum.
If you have an ad-blocker enabled you may be blocked from proceeding. Please disable your ad-blocker and refresh.