In a recent interview, Dr Paul Jacobs, CEO of Qualcomm, spoke about the journey of CDMA over the last 10 years and the growth opportunities going forward. He also shared his thoughts on Qualcomm’s strategy and vision…
How would you describe the last ten years of CDMA?
The whole journey of making CDMA an international standard has been a pretty exciting one. First we took the decision of introducing TDMA, then we came in with the new technology ?? CDMA. Working through the whole process of convincing people that CDMA was a better technology was an uphill task, where you fight it as the underdog. We then went through the whole process when the GSM community decided to use CDMA technology as well.
We certainly started out as outsiders to the process but over time, we have managed to be better partners to the operators and vendors. We are now finally poised to see that take off. For instance, we saw it in Japan with Hutchison.
The most fundamental change that we have seen over the last 10 years is that a phone has moved from being just voice to include data services, computing, entertainment, etc. The last 10 years have been incredible. It has brought about a fundamental mind shift of how a phone is going to be used in the future. Going digital has made a lot of difference to the whole industry just as it did to a lot of others I am sure.
How has the pace of “evolution” been? Has it been in line with your expectations?
It pretty well happened at the pace we expected it to. You know, when Irwin made a prediction a few years ago about when WCDMA was going to roll out, that was pretty accurate. It just takes a while for these technologies to come out but really, in the long run, it is not only the technology but all the functions and the number of functions that get integrated into the phone that has really increased over the years. The phone has become smaller, more cost effective and more power efficient as the technology has become better. Now we have video recording on phones, digital cameras, games, incredibly bright colour screens and all sorts of things. All this has happened very fast.
What would you consider as the high points?
Primarily the launches. The launch of Qualcomm in Hong Kong, with Hutchison and PrimeCo in the US. Those were incredible experiences. The standard we generated was again a big thing for us.For us, Sprint choosing CDMA over GSM was a big thing. DoCoMo’s launch of WCDMA was a big deal and then again, Korea launching CDMA in a big way were some of the high points for us.
What were the tough points?
We’ve had a few glitches on the way. For me personally, when we were running the handset business we had some tough times.We were launching a new phone and had to shut the battery down, that was pretty tough. On the CDMA side, when we were launching PrimCo and we found that there was a bug in the speech coding algorithm that caused a lot of noise, that was tough.We had to fix it and had to find the phones and ship them out. We were only a few weeks away from launching. So, those have been some of the toughest times for me.
What have been the biggest challenges?
Our biggest challenge has been overcoming the scepticism of the industry about CDMA, having people see us as good partners, accept the technology and our recommendations, and be needed as partners by operators who know the technology roadmap. KDDI and Sprint have been great examples of such partners. The challenge has been to get people to trust us and we have managed to accomplish that.
Are you at all surprised by the level of recent success of CDMA-based technologies?
Personally, I actually always believed.Perhaps I was naive when I was younger, but every day when I came to work, we thought we could change the world. As I see it, you cannot develop a new technology without feeling that way. We just expected to win. There have been so many ups and downs along the way that to get through the downs one just has to keep believing and being persistent. I just believed that eventually a large portion of the world was going to use CDMA.
What is going to drive 3G acceptance?
It depends upon the different markets. In Asia, it is high-end features like gaming, video, music, that is, entertainment applications that will be the drivers of 3G acceptance. Also, community applications such as blogging have become very popular. In markets like Europe particularly, voice is going to be the major driver because they don’t have the same pricing plans. With their kind of pricing plans, a lot of operators will use the capacity of WCDMA networks to try and use voice, and all the data applications are going to be layered on top of that. Some of the data applications will be available on 2.5G itself. So the issue right now is getting the correct capacity so that the applications can be massively deported. I think voice is going to be the key driver for Europe and all data applications are going to be layered on top of that.
Where do we go from 3G? What lies beyond?What does 4G mean?
I have a particular point of view on that.3G from my point of view has been an attempt to build a homogeneous network around the world. But that did not happen because of the backward comparability, different spectrum and politics.
The real concept of 4G is to build something for a particular application so that it is optimised. 4G to me is about a whole bunch of different possibilities. It refers to a heterogeneous network whether it is LAN, WAN, Wi-Fi or personal area networks like Bluetooth or any new technologies depending on the type of applications. I believe CDMA has a lot of room to evolve. It’s about how you make the technology work best for that application.
Is one worldwide standard a possibility (for 4G or 5G)?
There will be quite a bit of convergence, but it will happen in the chips inside the phone. I don’t think that one worldwide standard or technology is a possibility.
What is on Qualcomm’s horizon? What are its key priorities and goals?
We are in a good position right now ?? riding an upward trend. When it comes to new strategic opportunities, we are going to be very opportunistic because that’s the way the company has been. We continue to invest a lot in new technologies. We are right now looking at 4G, at applications and how to build technologies to suit the application. We are looking at our existing systems, their drawbacks and what we can do to better our performance and overcome some of our shortcomings. We are always finding ways to optimise the wireless operator’s business. We look into our value chain to see where we can innovate.
How does your recent acquisition figure?
Buying Flarion was about being able to provide different applications. Whatever the operator’s demands, we want to be in a position to supply them. Our acquisition of Flarion helps us to be broad-based suppliers of wireless technology. We built the company driving on CDMA. We use other technologies as well. We are not biased towards any form of technology. We will do what’s right technically and what’s right from the business standpoint.
Do you have any special message for operators at this time?
The message from me is that Qualcomm is going to work very hard to be the best partner to the operators. We are going to continue to develop new technologies, and generate revenues for the operators, export their businesses, make their businesses more cost effective, and bring more innovation into the industry. We are very well placed at the moment because we are still at a very early stage of the new era in the wireless world and innovation can happen everywhere.
