Steve Stroh and Nancy Gohring on Qualcomm's Flarion Acquisition ...
>> Qualcomm Will Acquire Flarion Technologies
Steve Stroh
BWIA/WiMAX
tinyurl.com
Qualcomm will acquire Flarion Technologies for $600 Million. Qualcomm may also pay an additional $205 million if certain milestones are met.
Talk about legitimizing the Broadband Wireless Internet Access industry ... First Intel, then Craig McCaw, now Qualcomm?
That said, the acquisition of Flarion Technologies is a very strategic move for Qualcomm.
The more obvious perspective is that Qualcomm has co-opted Flarion Technologies as one of the most credible and technologically capable of Qualcomm's competitors in Mobile Broadband Wireless Internet Access (BWIA) that isn't beholden to Qualcomm and its extensive CDMA Intellectual Property.
Flarion's production and test deployments, including a high-profile and reportedly very successful market trial with Nextel have proven that Flarion's Flash-OFDM technology can deliver Broadband Internet Access services, fully mobile, and that Voice (over Internet Protocol - VOIP) was "just another application" that worked fine on Flash-OFDM, which was developed from the ground up for handling Internet Protocol data traffic. Another notable technological achievement was that Flarion had successfully developed systems for disparate spectrum allocations, including 450 MHz and 700 MHz in the US. (Charlie Townsend of Aloha Partners must be sweating a bit from this announcement; as the [current] largest owner of 700 MHz spectrum in the US, Aloha will use Flarion equipment in its initial market deployment, and now will have to deal with Qualcomm, not the small nimble company Aloha was previously dealing with in Flarion.)
Qualcomm's Press Release makes it clear (in the first paragraph, no less)
Flarion, with a world-class team and an expansive portfolio of OFDMA intellectual property...
... that one of Qualcomm's primary motivations was the potential for adding Flarion's Intellectual Property on OFDM and in particular, Mobile OFDM to Qualcomm's already extensive Intellectual Property centered on its CDMA technology.
Less well understood is that Qualcomm's acquisition of Flarion Technologies is in fact a humbling admission by Qualcomm that its CDMA technology isn't really the be-all-and-end-all when it comes to Mobile Broadband Wireless Internet Access.
To be sure, there is extensive Intellectual Property developed around OFDM at many other companies, but there have been only few attempts (see my article Wi-LAN's Patent Tollbooth On The Road To WiMAX) at asserting that IP because the field of Broadband Wireless is so young. That will assuredly change with Qualcomm in charge of Flarion's Intellectual Property.
Nancy Gohring makes a good point in her WiMAX Networking News article "Qualcomm Is Buying Flarion for $600 Million In Stock And Cash" [see below] in referencing Robert "Teamrep" Syputa's WIMAX Trends article "Intel Against Qualcomm: Clash Of The Titans" [see prior post] that the real battle yet to be waged is Intel's intense advocacy of WiMAX / 802.16-2004 / 802.16e / 802.20 / OFDM versus Qualcomm.
Update: Om Malik had some good comments in his article "Qualcomm’s Flarion, a WiMAX End Game?" [see the post that follows this] I partially agree with Om's statement that "... these guys were scary smart and know how to position themselves in every part of the wireless ecosystem" (at least the wireless telephony ecosystem), but it seems to me that Qualcomm has been in denial for way too long about the progress on non-CDMA Broadband Wireless Internet Access technologies. Qualcomm still doesn't get Wi-Fi (especially municipal-scale Wi-Fi networks), they're up against a WiMAX juggernaut, wireless mesh networks are about to overturn all the rules in wireless... and they think that by buying Flarion they'll have the Broadband Wireless Internet Access industry by the throat? I don't think it's anywhere near that simple or that easy.
This article is Copyright © 2005 by Steve Stroh. Excerpts and links are expressly permitted (and encouraged.) <<
>> Qualcomm Buys Flarion
Nancy Gohring
August 11, 2005
wimaxnetnews.com
Qualcomm is buying Flarion for $600 million in stock and cash: I have to admit, this comes as a total surprise to me. With Qualcomm’s track record, this is very good news for Flarion because Qualcomm already has a firm foot in the door of the wireless community. While Qualcomm continues to push CDMA, it’s become clear that the future is OFDM and with this acquisition Qualcomm gets a strong portfolio of OFDM technologies. With Qualcomm owning CDMA and Flarion, integrating the two networks is likely to be smooth and the promise of such a smooth integration could be intriguing to a company like Sprint that has a CDMA network and is looking for something to do with its 2.5 GHz spectrum.
I’ll be interested to hear analysis on how this acquisition may affect the WiMax movement. Flarion is not a member of the WiMax Forum, so this potentially solidly pits Qualcomm against the WiMax community. Actually, it crystallizes what Robert Syupta, an analyst at Maravedis, calls the “Clash of the titans:” a monumental power struggle between Intel and Qualcomm.
More on Qualcomm and Flarion
Nancy Gohring
August 12, 2005
wimaxnetnews.com
This is big news and lots of people have theories on it [link to Steve's article above]: Now that I’ve had a chance to sleep on it, I’m suspicious that Qualcomm knows something about Flarion’s intellectual property that we don’t. I wouldn’t be surprised if Flarion turned out to own some piece of IP crucial to WiMax and now Qualcomm has managed to find a way to profit from the entire future of WiMax.
As I mentioned yesterday, with Qualcomm’s history in the wireless world, more operators are likely to consider Flarion’s technology now. Most notably may be Sprint/Nextel. Nextel already trialed a Flarion network and every report I read of that trial described happy customers. With an owner like Qualcomm, Sprint/Nextel may take a harder look at Flarion, especially because combining a Sprint CDMA network and a 2.5 GHz Flarion network just got that much easier.
As Om mentions [see next post], this deal also makes Qualcomm the big winner in the 450 MHz space. In Finland, all of the bidders said they’d either use CDMA or Flarion. IPWireless also offers gear in the 450 MHz band. <<
- Eric - |
