Investors Daily Article
IBD: This week you showed an advance in wireless data. Could you describe it?
Jabobs: We've developed HDR, which stand for high data rate. It supports faster Internet access in a way that's compatible with existing equipment at CDMA carriers. It's a relatively straight forward upgrade. With some incremental cost, they'll be able to offer (subscribers) data services at a competitive price with respect to (high-speed phone lines) and cable-based Internet access. It'll be a competitor for home Internet access, but it'll have the advantage of being completely wireless. so you can move around the house or drive to the airport.
IBD: Is HDR a stepping stone to third-generation (3G) wireless systems that speed up Internet access?
Jacobs: It's an alternative path if carriers chose to use it. It uses the same bandwidth as existing technology and as the first of the 3G systems to be deployed, which we call lx. lx is an evolutionary upgrade of existing CDMA that provides data rates of up to 384 kilobits per second.
I've seen (wireless) data rates of over 1 megabit with HDR.
1x should be in place sometime next year. HDR will probably be a number of months after that, depending on arrangements with carriers and manufacturers. 3G will use a wider bandwidth signal. Standards still need to be finished, and there's work to do in testing. HDR may be more efficient in use of spectrum than some 3G solutions, but we're working on both so operators will have a choice.
IBD: What kind of pricing will encourage use of wireless data services?
Jacobs: We've been looking at models in the $20 to $40 range (a month), essentially providing relatively unlimited service and supporting high burst rates (for downloading). Of course, the actual numbers will depend on the operators. As with cable, if many people are using the service heavily at the same time, the throughput can slow down. but it's always on. You don't have to dial-up each time you want an Internet connection.
IBD: What's the status of Wireless Knowledge, your joint venture with Microsoft Corp. to provide. Web-related network services to wireless operators?
Jacobs: It's moving ahead--more slowly than I might have liked. Some of the operators have been slower in rolling out data, but it's happening now. There have been discussions between us and Microsoft on the best ways to go, and we're probably in agreement at this point.
IBD: Qualcomm is an investor in a satellite start-up Globalstar Telecommunications. Will there be demand for its services given the problems at rival Iridium LLC?
Jacobs: In the case of Globalstar the (voice) quality is really very high. Iridium did a worldwide, expensive advertising campaign that wasn't very specifically targeted. we're going after specific groups. We're going into a soft launch to make sure there are no surprised, that everything is working the way people want it to work. probably by the beginning of the calendar year they'll be more paying customers on the system.
IBD: Qualcomm plans to sell its handset business by year-end. Earlier in 1999 Qualcomm sold off its network gear business to L.M. Ericsson AB. are you disappointed din the hardware business?
Jacobs: We got into the infrastructure and the handset side for strategic reasons. we had to make sure equipment and phones were available. That allowed CDMA to spread and grow. But we did hope to make them profitable businesses. Ericcson wasn't in CDMA before, so the deal was a plus for them and for us.
In handsets,we're still a small supplier. We have licensed 40 companies or so to make CDMA handsets. so pricing competition is greater. Another company might be better positioned to support our customers with higher margins and larger volumes.
We are focused on implementing the technology in chip sets and software. The data marketer will lead people to buy new phones with more capabilities, and carriers will buy evolutionary equipment, which will help our chip set business. |
