Qualcomm's Journey to the Top

INTRODUCTION-THE QUALCOMM

Qualcomm is an American multinational semiconductor company that has its headquarters in San Diego, California.  Qualcomm creates semiconductors and software related to wireless technology.

Qualcomm was established in 1985 by Irwin M. Jacobs and 6 other co-founders. Over the years, Qualcomm has expanded into selling semiconductor products during a predominantly fabless manufacturing model. It has also developed semiconductors and software for vehicles, watches, laptops, WiFi broadband, and other devices. The company derived its name "QUALCOMM" from "QUALity COMMunications". Steve Mollenkopf is the current CEO of Qualcomm and Paul E. Jacobs is the chairman of this company.

THE FIRST BREAKTHROUGH:-

In 1988, Qualcomm merged with Omninet and raised $3.5 million in funding to support the Omnitracs satellite communications system for trucking companies. Due to the high demand for Omnitracs, Qualcomm grew up to 620 employees in 1991. By 1989, Qualcomm had $32 million in revenues, 50 percent of which was from Omnitracs, and a contract of Omnitracs with Schneider National. The profits earned by Omninet helped fund Qualcomm's research and development for the Code-Division Multiple Access (CDMA) technologies for telephone networks.

THE TOUGH STAGE (1990-2015):-

Qualcomm was facing huge losses within the 1990s thanks to its investment in CDMA research. to get funding, Qualcomm filed an Initial Public Offering (IPO) in 1991, raising $68 million. a further $486 million was raised once they had to sell 11.5 million more shares. The second funding was done to boost money for the mass manufacturing of CDMA-based cellphones, base stations, and different types of equipment after most US-based cellular networks announced they might adopt the CDMA standard. In 1998, Qualcomm was restructured, resulting in a 700-employee layoff. Its base station and cell-phone manufacturing businesses were spun-off so as to specialize in its higher-margin patents and chipset businesses. By 2000, Qualcomm had grown to more than 650 employees, earned $3.2 billion in revenues, and $670 million in profit. 39% of its sales were from CDMA technology, followed by licensing (22%), wireless (22%), and other products (17%). By 2001, 65% of Qualcomm's revenues originated from outside us with 35% coming from South Korea.

THE CHANGE

In 2005, Paul E. Jacobs, son of Qualcomm founder Irwin Jacobs, was appointed as the new CEO of Qualcomm. Now the scenario begins to vary. While Irwin Jacobs focused on CDMA patents, Paul Jacobs focused much of Qualcomm's new research and development on projects associated with the web. In December 2013, Qualcomm announced Steven Mollenkopf to succeed Paul Jacobs as CEO. Mollenkopf was the primary person in Qualcomm's family who expanded Qualcomm wireless technologies to vehicles and wearable devices like smartwatches.

THE NEW HURDLES

Qualcomm announced its intent to accumulate NXP Semiconductors for $47 billion in October 2016. The deal was approved by U.S. antitrust regulators in April 2017 with some standard essential patents. Broadcom made a $103 billion offer to accumulate Qualcomm, but Qualcomm rejected the offer. Broadcom attempted a takeover, and raised its offer, eventually to $121 billion. The Broadcom acquisition was investigated by the U.S. Committee on Foreign Investment and blocked by an executive order from U.S. President Donald Trump, citing national security concerns.

Qualcomm's NXP acquisition then became a neighborhood of the 2018 China–United States trade war. U.S. President Donald Trump blocked China-based ZTE Corporation from buying American-made components, like those from Qualcomm. The ZTE restriction was lifted after the 2 countries reached an agreement, on the other hand, Trump raised tariffs against Chinese goods. Qualcomm extended a young offer to NXP a minimum of 29 times pending Chinese approval, before abandoning the deal in July 2018.

THE SECOND BREAKTHROUGH

On January 6, 2021, Qualcomm appointed its president and chip division head Cristiano Amon as the new chief executive of the company. On January 13, 2021, Qualcomm announced an agreement to acquire NUVIA for approximately $1.4 billion. NUVIA was a startup founded in early 2019 by ex-Apple and ex-Google architects. On March 16, 2021, Qualcomm announced the completion of their acquisition of NUVIA, and therefore the first products are going to be laptop CPUs and would be sampling within the last half of 2022.

WIRELESS CDMA-PRESENT AND FUTURE OF INDIA

1. 2G

In mid-1985, Qualcomm was hired by Hughes Aircraft to supply research and testing for a satellite network proposal to the Federal Communications Commission (FCC). In that year only, Qualcomm filed its first CDMA patent which established Qualcomm's overall approach to CDMA. The project with the FCC was scrapped in 1988 when the FCC told all 12 vendors that submitted proposals to form a venture to form one proposal. Qualcomm further developed the CDMA techniques for commercial use. At the time, CDMA hasn't considered viable in high-volume commercial applications thanks to the near-far field effect. Qualcomm filed three additional patents in 1989. They were for: an influence management system that adjusts the signal strength of every call to regulate for the near-far field effect which is a "soft handoff" methodology for transferring callers from one tower to the other.

2. 3G

3G standards were expected to force prior TDMA carriers onto CDMA, so as to satisfy 3G bandwidth goals. the 2 largest GSM manufacturers, Nokia and Ericsson, advocated for a greater role for GSM, so as to barter lower royalty prices from Qualcomm. In 1998, the ECU Telecommunications Standards Institute (ETSI) voted in support of the WCDMA standard, which relied less on Qualcomm's CDMA patents. Qualcomm responded by refusing to license its property for quality. The Telecommunications Industry Association (TIA) and therefore the Third Generation Partnership Program 2, advocated for a competing CDMA-2000 standard developed primarily by Qualcomm.

The ITU said it might exclude Qualcomm's CDMA technology from the 3G standards entirely if a patent dispute over the technology with Ericsson wasn't resolved.

Both the companies reached an agreement out-of-court in 1999, the month before a deadline set by the ITU. Both companies agreed to cross-license their technology to every other and to figure together on 3G standards.

Qualcomm consolidated its interests in telecommunications carriers, like Cricket Communications and Pegaso into a company, Leap Wireless, in 1998. Leap was spun-off later that year and sold to AT&T in 2014.

3. 4G

Initially, Qualcomm supported the Ultra Mobile Broadband (UMB) standard for fourth-generation (4G) wireless networks. UMB wasn't backward compatible with prior CDMA networks and didn't operate also in narrow bandwidths because of the LTE (Long-Term Evolution) standard. No cellular networks adopted UMB.

Qualcomm halted the event of UMB in 2005 and decided to support the LTE standard, albeit it didn't rely as heavily on Qualcomm patents. Then, Qualcomm purchased LTE-related patents through acquisitions. By 2012, Qualcomm held 81 seminal patents utilized in 4G LTE standards or 12.46%.

Qualcomm announced it had been developing the Scorpion Central Processing Unit (CPU) for mobile devices in November 2005. This was followed by the primary shipments of the Snapdragon system-on-chip product, which incorporates a CPU, GPS, graphics processing unit, camera support, and other software and semiconductors, in November 2007. The Gobi family of modems for portable devices was released in 2008.

In 2010, Qualcomm won a government auction in India for $1 billion in spectrum and licenses from which to supply broadband services. It formed four joint ventures with Indian holding companies for this purpose. A 49% stake within the holding companies was acquired by Bharti in May 2012 and therefore the remaining was acquired in October 2012 by AT&T.

4. 5G

Qualcomm has been developing technologies for future 5G standards in three areas: radios that might use bandwidth from any network it's access to, creating larger ranges of spectrum by combining smaller pieces, and a group of services for an online of things applications. In 2016, Qualcomm announced the first 5G modem chips and in October 2017, Qualcomm demonstrated a prototype. In July 2018,  Qualcomm announced its 5G antennas.

Qualcomm has a partnership with 19 mobile device manufacturing companies to commercialize 5G technology. In late 2020, Several phones were being sold with Qualcomm's 5G technology.

Other Qualcomm Technologies

Qualcomm created a MediaFLO in the year 2004. Qualcomm earned a total amount of $800 million profit from the MediaFLO. Qualcomm also sold FLO-based semiconductors and licenses. In July 2005, Qualcomm created FLO Forum standards with 15 different companies.

Qualcomm rebooted the trouble in 2013 with LTE Broadcast, which uses pre-existing cell towers to broadcast select content locally on a fanatical spectrum, like during major sporting events. Supported technology acquired from Iridigm in 2004 for $170 million. Qualcomm also began commercializing the Mirasol displays in 2007. Mirasol uses natural light shining on a screen to supply lighting for the display, instead of a backlight, so as to scale back power consumption.

In June 2011, Qualcomm introduced AllJoyn, a wireless standard for communicating between devices. In December 2013, the AllJoyn technology was given to Linux Foundation.

Qualcomm formed a healthcare subsidiary called Qualcomm Life. The subsidiary doubled its employee count by acquiring HealthyCircles Inc., a healthcare IT company, the subsequent May. Qualcomm life was later sold to a personal equity firm, Francisco Partners, in 2019.

The Holy Wars of Wireless

After the FCC said carriers were allowed to implement standards not approved by the CTIA, Qualcomm began pitching its CDMA technology onto carriers. This started what's often mentioned as "The Holy Wars of Wireless," an often heated debate about whether TDMA or CDMA was better fitted to 2G networks. Qualcomm supported CDMA standards over TDMA because the more popular 2G standard in North America, thanks to its network capacity. Qualcomm conducted CDMA test demonstrations in 1989 in San Diego and in 1990 in NY City. A $2 million trial network was conducted in San Diego for Airtouch Communications. In November 1991, 14 carriers and makers conducted large-scale CDMA field tests. After the results from the test, CTIA was in discussion to re-open CDMA. Finally, in 1993, CTIA changed its position and supported CDMA, adopting Qualcomm's CDMA. This promoted widespread criticism in forums, that had already invested heavily in the TDMA standard and from TDMA's developer, Ericsson. In 1995, The primary commercial scale of the CDMA cellular network was created in Hong Kong.

In 1991, Qualcomm and Electronics and Telecommunications Research Institute (ETRI) agreed to jointly develop CDMA technologies for Korean telecommunications. A CDMA standard was adopted because the national wireless standard in Korea in May 1993 with commercial CDMA networks being launched in 1996. CDMA networks were also launched in Brazil, Mexico, Argentina, India, and Venezuela. In 2005, Qualcomm entered the Russian and Latin American markets.

By 2007, Qualcomm's technology was in telephone networks in additional than 105 countries.

THE DEVELOPMENT IN RECENT YEARS.

Qualcomm developed its first processor for PCs in the year 2016. In January 2017, a second-generation and PC server chip, called Centriq 2400, was released by the company. Qualcomm was also developing laptop processors and other parts, as of 2017. Qualcomm also started introducing Snapdragon system-on-chips (SoCs) for various mobile devices.

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DISPUTE WITH APPLE

In January 2017, an investigation was initiated by Federal Trade Commission (FTC) against the allegations that Qualcomm had charged excessive royalties for patents, more than the "industry standards". That very same year, Apple initiated a $1 billion lawsuit against Qualcomm within the U.S. alleging Qualcomm for overcharged semiconductors, and therefore the latter did not pay $1 billion in rebates. Apple also filed lawsuits in China and therefore the UK. Apple alleged Qualcomm of engaging in unfair competition by selling industry-standard patents at a reduced rate in exchange for an exclusivity agreement for its semiconductor products. An FTC report reached an identical conclusion. Qualcomm filed counterclaims against Apple, alleging that Apple had made false statements to sue Qualcomm. Qualcomm also sued Apple's suppliers for allegedly not paying the royalties, claimed by Qualcomm. Qualcomm also filed a petition to the International Trade Commission (ITC) to ban imports of iPhones on the premise that they contain stolen Qualcomm patents after Apple's suppliers had stopped paying.

The International Trade Commission (ITC) started an investigation in August 2017, on Apple's use of Qualcomm patents without royalties. Qualcomm also filed suit against Apple in China for alleged violation in October 2017. the subsequent month, Apple countersued, alleging Qualcomm was using patented Apple technology in its Android components.

In December 2018, Chinese and German courts held that Apple infringed on Qualcomm patents and banned sales of certain iPhones. Some patents were held to be invalid, while others were infringed by Apple.

In April 2019, Apple and Qualcomm reached an agreement to cease all litigations and signed a six-year licensing agreement. The settlement also included a one-time payment from Apple to Qualcomm of about $4.5 to $4.7 billion.

OPERATIONS AND MARKET-SHARES

Qualcomm develops software, semiconductor designs, patented property, development tools, and services, but doesn't manufacture physical products like phones or infrastructure equipment. The company's revenues are derived from licensing fees to be used of its property, sales of semiconductor products that are supported by its designs, and other wireless hardware, software, or services.

Qualcomm divides its business into three categories:

1. QCT (Qualcomm CDMA Technologies): 65% of revenue comes from here.
2.  QTL (Qualcomm Technology Licensing): 10% of revenue. And,
3.  QSI (Qualcomm strategic initiatives): 5% of revenue.

Qualcomm is the main and largest provider of semiconductor products for wireless communications and data transfer in portable devices. Qualcomm features 39% market shares for smartphone processors (SoCs) and 50% market shares for broadband processors.

QUALCOMM SNAPDRAGON- SoC

Snapdragon is the system on a chip (SoC) which is the main brain and heart of the mobile devices designed and marketed by Qualcomm Technologies. The Central Processing Unit (CPU) uses the ARM architecture. one SoC may include multiple CPU cores, a Graphics Processing Unit (GPU), Adreno, a Snapdragon wireless modem, a Hexagon Digital Signal Processor (DSP), a Qualcomm Spectra Image Signal Processor (ISP), and other software and hardware to support a smartphone's Global Positioning System (GPS), camera, video, audio, gesture recognition, and AI acceleration. Snapdragon is often referred to as a "mobile platform" (e.g. Snapdragon 865 5G Mobile Platform). Snapdragon semiconductors are embedded in devices of varied systems, including Android, Windows Phone, and Netbooks. they're also utilized in cars, wearable devices, and other devices. additionally, to the processors, the Snapdragon line includes modems, Wi-Fi chips, and mobile charging products.

HISTORY OF SNAPDRAGON

In November 2007, Qualcomm announced it had been developing the Scorpion Central Processing Unit (CPU). The Snapdragon system on a chip (SoC) was announced in November 2006 and included the Scorpion processor, also as other semiconductors. This also included Qualcomm's first custom Hexagon Digital Signal Processor (DSP).

PRODUCTS OF SNAPDRAGON

1. QSD8250 was the first Snapdragon SoC that was launched in November 2007. It supported 720p resolution, 3D graphics, and a 12 MP camera. It was clocked at 1 GHz.

2. By late 2009, Snapdragon had planned for dual-core SoCs and the smartphone manufacturers announced they would be using Snapdragon SoCs in the Acer, HTC, Toshiba, and Sony Ericsson Xperia. In December 2009, Lenovo announced the first netbook product using Snapdragon SoCs.

3. By June 2010, Snapdragon chips were used in different (approx. 20) mobile devices and other devices as well. 

4. By 2011, Snapdragon has used in Hewlett Packard's (HP) WebOS devices and had a 50% market share with a $7.9 billion profit in the smartphone processor market. 

5. By 2012, the Snapdragon S4 (based on Krait CPU) had taken a dominant share from other Android SoCs like Nvidia and Texas OMAP.

6. As of July 2014, Android devices in the smartphone markets had been increased by 50% and around 40% of the smartphones have Snapdragon SoCs.

Today, Qualcomm is the biggest company to sell chipsets (SoC) in the mobile markets. Qualcomm Snapdragon chipsets are even faster, better and snappier as compared to other companies!