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When Qualcomm announced on Dec. 4 that it was acquiring Airgo and the Bluetooth business of RF Micro Devices, the company presented the added products as being highly important. However, not everyone agrees. To some, it was just one way of rounding out the companys patent portfolio.
According to Qualcomms vice president of strategic products, Mike Concannon, the acquisition would complement the companys existing products, allowing it to offer new capabilities to customers.
“I think that with the combination of broadband wireless with the addition of the 802.11n technology and the broadband streaming weve been offering, its a compatible technology set for the mobile user,” Concannon said.
Concannon said that his company is offering more powerful processors, digital signal processing, higher data rates and greater storage, and that the next logical step was to get in touch with other parts of the network such as Bluetooth and wireless LAN.
“If we look at the connectivity of these mobile devices, the personal area network devices such as Bluetooth, local like Wi-Fi, and broad area like cellular, are all needed on a mobile device,” Concannon said.
He said that with the acquisition of Airgo, Qualcomm now has 802.11n technology. “I think in addition to the products, we pursued these acquisitions because of the quality of the skills,” Concannon said.
Analysts, however, arent so sure that the acquisition is all that big a deal.
“Its really a patent play,” said analyst Chris Ambrosio, director of wireless device research for strategy analytics in Boston. “Its meant to strengthen Qualcomms position rather than being industry shifting.”
Ambrosio added that he thinks there will be little impact on the industry. “I think that in terms of Bluetooth, the impact is null. I would have to say the same for the MIMO side. So its purely a patent strengthening play from our view.”
Ambrosio said that the acquisition is mostly important to Qualcomm because the company is now set to get its piece, where it might have been excluded before.
“It doesnt change how that technology is evolving in the 11n market,” he said. “Its meant as Qualcomms entry point. Qualcomm wont do anything without having a patent position. It puts their foot into the market,” he said.
Ambrosio said that the acquisition will add some benefits for Qualcomms customers, potentially getting them into converged devices. “Qualcomm is in a bit better position than they were,” he said.
But Ambrosio also noted that the acquisition of the two companies is part of Qualcomms way of doing business, and no different from what the company has done with consolidating their patent portfolio in the past.
“They are very keen on integrating technologies into their chip set products. They want to drive out costs for their licensees by integrating as much as they can and thats what they are doing on the Bluetooth part,” he said.
Concannon, however, says the acquisition goes beyond that.
“We hope to be working with customers so they can be working with these parts by the first part of 07,” he said.
But Concannon said that there is also a broader goal. “If you start with the big picture, you start to lay the groundwork for ubiquitous mobility. People can be connected wherever they are. It starts to solve their connectivity problems,” he said.
Concannon said the sale of the two entities should close before the end of 2006, subject to board and regulatory approval.