High IQ

Qualcomm held its annual innovation event last month, where much of the emphasis was placed on the growing connectivity of traditional and non-traditional communications devices, and the interfaces to interact with them. Demonstrations included wireless health applications, augmented reality and gesture-based technology, underlying Qualcomm’s growing portfolio of next generation mobile services. Comm. reports from Istanbul

Jacobs says Qualcomm is spending a lot of time looking at how to get its chipsets into other devices and machines beyond [traditional] mobile devices

Paul Jacobs, Qualcomm’s chairman and CEO described the mobile communications business as the most successful technology platform ever, with mobile revenues expected to reach US$1.3 trillion in 2011. For its part, Qualcomm invests around US$2.5 billion annually in R&D, which has helped mobile to become the dominant computing platform globally. Smartphones, for example, are about to exceed the number of PCs accessing the Internet for the first time.

Strategy Analytics forecasts there will be a 10-12x increase in data being transmitted over mobile networks by 2015, with mobile broadband traffic having already surpassed fixed broadband traffic as of last year. As such, much of Qualcomm’s activities are focussed on connectivity as the numbers of devices that are set to be connected to a network proliferate in the years ahead.

“A full web experience is expected in mobile,” Jacobs said. “At Qualcomm we are looking at how to get our chipsets into other devices and machines beyond [traditional] mobile devices,” he added.

As part of this strategic direction, at the beginning of this year Qualcomm announced the acquisition of Atheros, a leader in innovative technologies for wireless and wired local area connectivity in the computing, networking and consumer electronics industries. At the time of the announcement Qualcomm stated that the acquisition was intended to help accelerate the expansion of its technologies and platforms to new businesses beyond cellular and provide access to significant new growth opportunities.

“There is an evolving connectivity challenge,” commented Craig Barret, president of Qualcomm Atheros. “Elements of this challenge extend to control, with respect to smart grids and smart homes; consumption, with respect to access to media; and connections, related to communications such as email and such.”

Jacobs believes that proximity based peer-to-peer abilities are going to be instrumental for devices to be able to identify what is around them, and the work that the company is doing in the augmented reality space is already feeding into that.

Qualcomm’s augmented reality platform enables interactive 3D experiences to take place on top of everyday objects. Applications under development range from gaming and play to interactive media/marketing and instructional how-to/aid; with the technology looking to open the door for a plethora of new mobile applications and services.

Given the rise of the ‘Internet of everything’, the manner in which people use and interact with the multitude of connected devices of the future is a key area of development at Qualcomm. The company is already piloting gesture-based technology that allows on-screen scrolling via ultra sound, obviating the requirement to touch the device in order to interact with it. Qualcomm expects commercialisation of the technology in the H212-H113 timeframe.

Qualcomm’s Snapdragon series of chipsets also remain a key component of the company’s activities. The company showcased its Snapdragon S3 processors with dual-core CPUs of up to 1.5GHz, which support HD 1080P video and stereoscopic 3D video capture as well as playback of locally stored, downloaded or live streamed content.

Snapdragon processors and their integrated, custom-built Adreno GPUs deliver to mobile devices 3D gaming experience previously only seen on consoles and PCs.

Snapdragon S3 processors are also the first asynchronous dual-core CPU designs in the industry, and Qualcomm remains confident of the uptake of these chipsets as the number of 4G networks to launch commercially continues to rise around the world.

“There are 125 Snapdragon devices announced, with 250 in design,” said Cristiano Amon, SVP of product management at Qualcomm CDMA Technologies (QCT). “Eight tablet modems have been announced, with 40 plus in design,” he added.

Qualcomm has been showcasing its technology leadership in the MEA region as well, participating in a number of programmes around its pet projects including m-health and smartphone and applications development. Etisalat, Zantel (Etisalat’s affiliate in Tanzania) and Qualcomm recently agreed to jointly provide connectivity, handsets and other technologies to a programme aimed at extending access to healthcare in Tanzania, for example.

In the Middle East specifically, in July Qualcomm launched its Qualcomm Powered smartphone initiative in Saudi Arabia, aimed at bringing OEMs (original equipment manufacturers), retailers, and network operators closer together to drive mobile data usage.

Speaking exclusively to Comm. at the time, Jay Srage, Qualcomm’s president for the MEA region said that the technology provider had partnered with Saudi telco Mobily; Saudi handset retailers Axiom and Jarir Bookstores; and six device manufacturers – Sony Ericsson, HTC, Alcatel, Samsung, Acer, and Huawei – in the offer of a joint strategic and marketing campaign aimed at driving up smartphone and data usage in the kingdom.

“Qualcomm has always been interested in working with ecosystem players across the entire telecom value chain, and with respect to the Qualcomm Powered initiative, I like to refer to us as being the glue that binds the various parties together,” Srage said. “What we have done in Saudi Arabia, and aim to do in other parts of the region, is to enable data packages and connections to be accessed in a way that unleashes mobility and mobile data usage,” he added.

The six OEMs have a combined portfolio of around 25 smartphones offered in Saudi Arabia, and as part of the Qualcomm Powered initiative in the kingdom Mobily agreed to offer customers who purchased any of the smartphones included in the campaign data usage at no charge for a period of time following the purchase.

Qualcomm Powered looks to benefit OEMs through offering a potential differentiation tool, while complimenting their existing in-country supply and distribution channels. The initiative seeks to benefit retailers given it works as a virtual subsidy of the smartphones sold, allowing retailers to sell more of them. It is also set to benefit service providers by raising the awareness of smartphones and their capabilities, with the view to more subscribers becoming paying customers to data services in the longer-run.

“We are following up the launch in Saudi Arabia with similar launches in Egypt and the UAE in due course,” Srage revealed. “These are all high-growth markets in which smartphone usage is increasing rapidly. Our aim is to launch these initiatives and then after a few months assess their impact. If it is successful our aim is to roll it out across the MEA and even beyond the region,” he added.

In Egypt, more than one network operator has already signed up to Qualcomm Powered, and Srage said he also expects that the number and size of OEM partners is likely to grow should this new model of joint, strategic marketing focus be vindicated.

Jay Srage believes the Qualcomm Powered initiative allows the company to work with ecosystem players across the entire telecom value chain, to the benefit of all constituents

Innovators are also aware that being at the cutting edge comes at the risk of setbacks in certain pursuits, and Qualcomm is no exception. Late last year the company agreed to sell wireless spectrum in the US in the 700MHz band, spectrum that had been previously dedicated to its MediaFlo mobile TV service. MediaFlo was purpose-built by Qualcomm and offered broadcast television content to mobile devices. Developed as an end-to-end mobile multimedia delivery platform, the MediaFlo system received live broadcast feeds, transformed content into a mobile format, and securely broadcasts to an unlimited number of mobile users. However despite high expectations the service never really took off in the US.

Qualcomm is also facing spectrum-related issues in India, where last month a senior official from the Department of Telecom (DoT) alleged that Qualcomm did not apply for and acquire licences within three months of the wireless broadband airwaves (BWA) auction. Although the auctions ended in June 2010, Qualcomm apparently did not apply for permits until December.

The DoT concluded that “this was beyond the validity period for applying and acquiring the relevant licence.”

Qualcomm paid over US$1 billion for permits in Delhi, Mumbai, Haryana and Kerala in the June 2010 auction and the cancellation of permits could result in Qualcomm forfeiting the entire fee that it paid. However, a final decision on the amount will be made after the DoT has evaluated the company’s response.

Qualcomm had intended to see the launch of a LTE-based 4G services in India by the end of this year utilising the spectrum, in cooperation with a local operator partner.

However, despite such setbacks, Qualcomm‘s momentum overall places it in the enviable position of potentially being one of the largest beneficiaries of the migration to 4G.

“Statistics show there are 1.43 billion 3G connections now. This number will rise to two billion by 2015. 400 million of this increase will be accounted for by markets in the Middle East and Asia,” Jacobs said. “There are 136 HSPA+ connected networks globally today and 24 commercial LTE networks, with a further 166 network commitments, so I am confident in the new broadband network investments,” he added.