Qualcomm, the world’s largest mobile chip maker, will cut about 600 jobs, a move that reportedly has more to do with shifting business priorities and less with ongoing issues in China and investigations into business practices in the United States and Europe.
Qualcomm has confirmed to media outlets that about 300 of the impacted jobs will come from California, while the other 300 or so layoffs will occur in international offices. The company currently has about 31,300 employees worldwide.
Qualcomm continues to dominate the market for systems-on-a-chip (SoCs) for smartphones, and next year will release the latest generation of its 64-bit ARM-based chip, the Snapdragon 810. At the same time, the company is pushing its low-power SoC expertise into the burgeoning Internet of things (IoT), and last month CEO Steve Mollenkopf said the company will venture into the highly competitive market for ARM-based SoCs for servers.
The chip maker also last month released smartphone and tablet developer platforms for the Snapdragon 810. During a conference call to talk about the most recent quarterly financial numbers, Mollenkopf said that even with the expansion into the SoC and data center, mobile devices will continue to be a focus for the company.
“We believe the smartphone will be central to the growing number of connected things around us, and our focus is on aligning our resources to continue to capture these opportunities,” he said.
At the same time, Qualcomm’s IoT efforts took a hit earlier this month when Rob Chandhok, the executive who headed up the chip maker’s push in such areas at the Internet of things and wearable devices, left the company after 14 years. Chandhok re-emerged Dec. 10 as president and chief operating officer of IoT startup Helium Systems.
The San Francisco company, which also on Dec. 10 announced a $16 million round of funding led by Khosla Ventures and supported by others like Salesforce.com CEO Marc Benioff and SV Angel, reportedly is working on developing a wireless protocol and appliances that would more efficiently and affordably move the massive numbers of small amounts of data that the billions of connected devices and sensors that will make up the IoT will generate in the years to come.
“We think we are going to be an enabler for an explosion of business around things and sensor data,” Chandhok told The Wall Street Journal.
While at Qualcomm, Chandhok was behind the development of the AllJoyn framework for linking the vast numbers of connected devices and systems in the IoT. An industry group that included Qualcomm, Cisco Systems and Panasonic created the AllSeen Alliance consortium a year ago to develop an open platform to facilitate communications between IoT devices, and is using AllJoyn as the foundational technology.
The layoffs and executive moves at Qualcomm come with the regulatory issues as their backdrop. The Chinese government a year ago began an investigation to determine whether Qualcomm has violated anti-monopoly laws, a claim company officials have denied. They also now are wrestling with the question of whether a Chinese company that has licensed Qualcomm’s technology is under-reporting sales, which would hurt Qualcomm’s bottom line.
During the conference call last month regarding quarterly earnings, Qualcomm President Derek Aberle said the company is making strides in settling that dispute as well as issues surrounding some unlicensed Chinese OEMs supplying devices leveraging Qualcomm’s three-mode LTE technology, but added that those issues probably won’t be resolved until the Chinese government’s investigation concludes.
At the same time, Qualcomm also is facing preliminary investigations by the U.S. Federal Trade Commission and European Union regulators.