The first telematic application will offer a transmission speed of about 144 Kbits/s, according to Jacobs. "But just behind that, we have the next version of the technology that will offer about 2.4 Mbits/s in a very cost-effective fashion," he said.
Qualcomm, Ford create joint venture to develop telematics -- New company named Wingcast will drive Net connections into autos
FRIDAY, AUGUST 4, 2000 11:39:00 PM EST
Aug. 04, 2000 (Electronic Buyers News - CMP via COMTEX) -- Moving deeper into automotive wireless technology, Qualcomm Inc. last week created a joint venture with Ford Motor Co. aimed at linking the car maker's vehicles to the Internet.
Under the terms of the agreement, the two will make an undisclosed investment in Wingcast Inc., a San Diego-based company chartered with driving wireless voice and Internet connections-otherwise known as telematics-into a new generation of Web-enabled automobiles.
"The wireless and telematics industries are at a pivotal point as we approach a new era of the wireless Internet," said Irwin M. Jacobs, chairman and chief executive of Qualcomm, in a conference call with analysts last week. "The equipment that will go into cars will be relatively low cost, and with the Internet and high-speed connection rates, we will be able to provide a wide range of services."
The first telematic application will offer a transmission speed of about 144 Kbits/s, according to Jacobs. "But just behind that, we have the next version of the technology that will offer about 2.4 Mbits/s in a very cost-effective fashion," he said.
In addition to Ford and Qualcomm, telematics-equipment supplier Cartell Corp., Romulus, Mich., will hold a minority stake in Wingcast.
Wingcast, which will be headed by former Microsoft Corp. consumer-appliances vice president Harel Kodesh, will base its tele-matic designs on San Diego-based Qualcomm's CDMA IP and will equip more than 1 million Ford cars and trucks by the end of 2002 and 9 million by 2004. Nissan Motor Co. Ltd. has also agreed to implement the telematics technology in its luxury vehicles at an unspecified date.
While Qualcomm said it's designing chipsets to accommodate third-generation telematic technologies for upcoming applications, it remains to be seen whether its CDMA technology will form the basis of the 3G wireless standard. For GSM, which is currently the predominant wireless standard in Europe, Wingcast will rely on undisclosed third-party suppliers.
The formation of Wingcast will help Qualcomm develop its entire CDMA portfolio, following last week's spinoff of the company's chipset and software design business, according to Paul E. Jacobs, executive vice president of Qualcomm.
"Qualcomm's business model accelerates CDMA growth overall through internal technology development, investments, acquisitions, and start-ups," Jacobs said. "These investments increase the growth of CDMA, which allows us to make further investments."
Jacobs noted that in addition to CDMA technology, Wingcast will rely on Qualcomm's other offerings, such as its OmniTRACS business, a two-way mobile-communications and tracking system designed for the transportation industry.
"Since the early 1990s, OmniTRACS has probably been one of the only profitable data wireless businesses," Jacobs said. "We have used it to ensure applications are delivered safely to people in their vehicles. It offers management software, network operating systems, back-office integration capabilities, and hardware expertise."
While the new venture is designed to add to Qualcomm's royalty-based business, Dale R. Pfau, an analyst at CIBC World Markets Corp. in San Francisco, was skeptical of the magnitude to which Wingcast will boost Qualcomm's revenue. "As far as I'm concerned, telematics is only a small part of wireless systems," Pfau said. "It represents yet another venue, which may or may not make money for Qualcomm."
Telematics will grow to $42 billion by 2010, from $1 billion in 1998, according to IDC, Mountain View, Calif. The wireless-handset market will be worth $55 billion this year, according to Forward Concepts Co., Tempe, Ariz.
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By: Bruce Gain Copyright 2000 CMP Media Inc.
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