1/25/00 Conf Call 2000 Q1 Earnings - Selected Bytes - Business Overview Part I
2000 Q1 Earnings Conference Call 1/25/2000
Entire event: 2000 Q1 Earnings Conference Call (67 min.)
corporate-ir.net
Irwin Jacobs Segment -- Timemark: 2:45
Irwin Jacobs: During the first quarter of fiscal 2000, we achieved record financial performance based to a significant extent on the strong growth of CDMA world wide. We completed an agreement on the sale of our subscriber business to Kyocera. It allowed us to further focus our resources on the development of more powerful chip sets and software to supply to our licensees, including Kyocera and to accelerate the availability of, and applications for the wireless internet.
Operators around the world are recognizing the rapidly approaching explosion in demand for broadband wireless access, and CDMA is clearly leading the way. The next evolutionary step for CDMAone, referred to as IS95-B, is now operational in South Korea and Japan and supports 64 kilobits per second CDMA data. Nikkei(?) Electronics has reported that DDI and IDO, the Japanese operators, who plan to merge along with KDD, have targeted 10 million CDMA customers by March 2001, up from 3.5 million at the end of 1999. The 64 kilobit per second data rate, well above that of non-CDMA competitors, supports a variety of new services and is a significant first step for the wireless internet.
We anticipate that new data services will increase wireless minutes of use and spur replacement phone sales. We're very pleased to note that every phone manufacturer that has now built products for 64 kps CDMA services uses Qualcomm's MSM-3000 chips.
The evolution of CDMA to even higher data rates and efficiency continues to accelerate. Last October we announced our 5000 family of chip sets to support multi-carrier 1x, which will be the first 3G or 3rd generation technology, were planned for commercial introduction this year. This 3G technology is called 1x because it uses the same bandwidth as today's CDMA networks, but has achieved an approximate doubling of voice capacity, greater coverage for cells, and supports burst data rates over 300 kps for a mobile or fixed user. We believe every CDMAone operator will rapidly introduce this technology, and hopefully non-CDMAone operators will seriously consider it for an overlay in a significant step towards their 3rd generation of wireless communications.
The MSM-5000 and CSM-5000 chips are back from fabrication, are fully capable, and are now being used in laboratory over-the-air calls -- performing very well. We believe all early CDMA systems will use these chips for both phones and infrastructure.
Our High Data Rate, HDR technology, which also uses the same bandwidth as CDMAone and 1x, but supports mobile and fixed burst rates over 2 megabits per second for truly broadband wireless internet access, is progressing rapidly. ??????, a successful industry demonstration in November with approximately 200 operators and manufacturers from around the world we announced technical and market trials with KT Freetel in South Korea. Several operators and manufacturers are now, or will participate in several phases of capacity tests, the first phase of which is underway and demonstrating higher throughput than we originally anticipated.
Qualcomm has invested 200 million dollars in KT FreeTel to help get HDR deployed in major markets. Although this is a good example of the type of strategic investments we will make to ensure the success of CDMA and HDR technology, we also expect this investment to be profitable in its own right. In fact, since making our 200 million dollar investment in KT FreeTel, the public value of our stock in KT FreeTel has doubled in value to 400 million dollars.
Building on the HDR development, we also announced a field trial of HDR with Hitachi in Japan. Following successful trials, Hitachi intends to develop and manufacture HDR infrastructure equipment. We expect other announcements to follow. We are currently on track to support commercial roll out of HDR in 2001. |
