Qualcomm Case Study

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Qualcomm is an American wireless technology company founded in 1985 that is a pioneer in CDMA technology. It is the world's largest fabless chipmaker and provider of wireless technology.

Some of Qualcomm's major products and services include OmniTRACS satellite locating and messaging service, CDMA cellular technology including CDMAone, CDMA2000 and LTE standards, and BREW applications platform.

Some prominent founders and leaders of Qualcomm include Irwin Jacobs, Andrew Viterbi, Klein Gilhousen, William Lee and Allen Salmasi.

Qualcomm Case Study

Introduction
Qualcomm – American wireless Telecommunications R&D company
based in San Diego, California.
Founded in 1985.
Named the world's #1 most admired company since 2002 by Fortune
magazine.
First products and services included the OmniTRACS satellite locating
and messaging service.
1990 - Began the design of the first CDMA-based cellular base station.
1992 - Began to manufacture CDMA cell phones, base stations, and
chips.
Inventor of CDMAone (IS-95), CDMA 2000, and CDMA 1xEV-DO and
LTE standards.
World's largest fabless semiconductor producer and the largest provider
of wireless chipset and software technology.
Global company with offices in different countries of the world.
Eminent Personalities
Dr. Irwin Mark Jacobs – Founded Linkabit in 1968 and went on
to become the founder and CEO of Qualcomm.
Dr. Andrew Viterbi – Cofounded Linkabit and Qualcomm with
Irwin Jacobs and is well known for his decoding algorithm, the
Viterbi Decoder.
Klein Gilhousen – Qualcomm Cofounder and is credited with
developing fundamental technology used in CDMA mobile
communication.
William C.Y. Lee – Assisted Qualcomm in development and
deployment of CDMA technology in commercial cellular
networks.
Allen Salmasi – Founded Omninet Corp. which merged with
Qualcomm in 1988. Conceptualized Qualcomm’s OmniTRACS
product.
The Journey
“QUALCOMM Incorporated (Nasdaq: QCOM),
pioneer and world leader of Code Division
Multiple Access(CDMA) digital wireless
technology..”
September 1988 - Cellular Telecommunications
Industry Association (CTIA) publishes a set of
User Performance Requirements (UPR).
February 1989 – Regular visits to cellular
operators to promote CDMA.
Funding from Pacific Telesis (PacTel Cellular,
later Airtouch Cellular and now Verizon Wireless).
Benefits for Network Operators
Enhanced and flexible capacity.
Better security.
Full Frequency Reuse.
Easy transition from analog.
Reduced number of towers.
Benefits for End Users
Better voice quality.
Enhanced privacy.
Better connection quality.
Longer battery life.
Selling the Invisible
Qualcomm was selling a promise to
prospective companies.
Cash Crunch.
IPO on December 16,1991.
Image Building among customers.
CDMA was made an alternative industry
standard, IS-95 in 1993.
Confidentiality in License Agreements
Details in the design, engineering and
operations of CDMA systems not commonly
known outside the company.
Confidentiality – A key aspect of all licensing
agreements covering intellectual property.
May 2003 – Texas Instruments executives
publicly stated their agreement with Qualcomm.
Court ruled in favor of Qualcomm.
Qualcomm dropped the suit rather than
divulging important details of the contract.
Litigation
Ericsson and InterDigital challenged Qualcomm
on its monopoly on CDMA’s cellular
implementation.
InterDigital filed a lawsuit against Qualcomm and
OKI for infringing on some of its CDMA and
TDMA intellectual property that was protected
under patents.
Qualcomm’s legal team consisted only of one
person before the litigations but now it maintains a
team of legal experts.
Spends millions of dollars on litigations.
Emerging Markets
20 million CDMA subscribers in China.
India introduced the New Telecom Policy in
1999 benefitting.
Invested $200 million in Reliance Infocomm.
Reliance started CDMA services in May 2003.
Also making inroads in other emerging markets
such as Russia and Latin America.
Also hoping to break into the European market.
Key events
1993

 South Korea adopts CDMA as a platform for the nation’s wireless
service.
 1994
 Successful completion of field tests for CDMA in China.
 1995
 Sprint adopts CDMA technology for its PCS network.
 First commercial launch of CDMA network in Hong Kong.
 1996
 Telecommunications Act of 1996 to deregulate telecommunications and
spur competition.
 PrimeCo (now Verizon Wireless) launches CdmaOne in 15 US markets.
 1997
 $18 million for naming rights of San Diego's Qualcomm stadium until
2017.
Contd..
1998
 7.8 million CDMA users worldwide, 3.7% market share.
 TIA endorses CDMA2000 as the 3G solution for the ITU.
1999
 Qualcomm sells its phone manufacturing capabilities to
Kyocera.
2000

- Acquires SnapTrack, a developer of GPS technology for $


1 billion in stock.
2001

- Qualcomm introduces BREW applications platform.


Contd..
2003
 Qualcomm ships its one billionth CDMA chip.
2004
 12% royalty income coming from W-CDMA
products.
 Verizon Wireless launches nationwide CDMA
1xEV-DO network in US.
 CDMA surpasses 200 million users
worldwide.
Transforming the business
Compete more head-to-head with peers based on
features and value of its products.
Relying on its superior intellectual property and
huge investments in R&D.
Secured the necessary talent and rights to include
GSM and other protocols in its CDMA products.
Permeate the market beyond its traditional
CDMA lines.
Ability to adapt to the new environment and
effectively court new customers.
“ Entire industries can start from a simple
idea-a drawing scribbled on a napkin, or
a hobby that unexpectedly grows into a
full-time endeavor.”
References
The Qualcomm Equation: How a
Fledgling Telecom Company Forged a
New Path to Big Profits and Market.
www. qualcomm.com
www.reuters.com
www.quicinc.com
Thank You

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