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‘The phone’ll be your life’s remote control’

CDMA technology pioneer Qualcomm looks upon the phone as the most personal device, for communications, entertainment, computing and productivity.

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CDMA technology pioneer and mobile phone chip maker Qualcomm looks upon the phone as the most personal device, not just for communications, but also for entertainment, computing and productivity, says Paul E Jacobs, chairman and CEO of the company. Since it makes the crucial wireless chips, the company makes money almost everytime a phone is manufactured. Qualcomm now wants to expand that vice-grip across media platforms such as gaming consoles to smartbooks (with its Snapdragon chipset) to cardiac monitors and electronic pills that are popped to monitor the innards of patients.

In a media interaction — including with DNA — at the company’s San Diego headquarters last week, Jacobs held forth on the mobile revolution and the company’s plans for India and other markets. Excerpts:
 
On the way the mobile telephony revolution is panning out…
We see a change coming where the phone is almost going to be the remote control of your digital life, and as you move through environment, wireless is going to be embedded in a big way. It’s almost going to be your sixth sense. It will tell you whether there is content available for you, whether there are services available at a given place. This blurring between the cyber world and the physical world is going to come down increasingly and it’s going to be mediated by the phone that you carry. And I think that is true no matter where you live.

About Qualcomm’s role in it…
We try and drive the multi-broadband technologies forward, but we are also very interested in driving the computing industry forward. We do a lot of work there and we think that mobile computing is fundamentally going to be about phones.
There is a great opportunity through telecom to improve the economic condition of people around the world.

As we look ahead, healthcare is going to be increasingly about being connected. Smart grids obviously require to be connected. Electrical vehicles will have to communicate with the network.

On the Qualcomm business model…
We are in a very unique position by having our licensing business and semiconductor business together. We can afford to invest in advancing the technology much more than our competitors because we have the licensing part of the business. And because of that, we are on the leading edge — whether it’s the next new radio technology or electronics technology or new computing technology. We are looking at far out in the future. When I talk to you about alternated reality, I doubt there is too many of our competitors building hardware accelerators just to make alternated reality work. We are able to do that. And not only that, we are looking at radio technologies to make that happen.

On the growth in licensing revenues as countries like India and China move to smarter phones…
Hopefully, that (the shift to smarter phones) will help. Obviously, we are trying to drive down prices as much as possible. You have seen that happen. Smart phones are great for us. I think that trying to get smart phones into the emerging market is very important. And we are going to do it in a number of ways. We will make low-end phones smart by putting a web browser in that. We are already seeing that with the fishermen in Kerala who get information on weather conditions and market conditions. Obviously, there will always be a market that is going to buy high-end products. What happens right now is, it is really a very different strategy from the research and development standpoint. We used to just invest in the high end and technology used to just trickle down and make it to an emerging market. But that is not how it works anymore. What happens today is you invest in the high end for certain features and then you invest in the low end heavily for integration. The higher the degree of integration, the lower the cost. Technology, actually, trickles into the middle. And as that happens, these low-end devices get more and more functionality.

On the rub-off the CDMA technology has had on its inventor’s pockets…
It has done pretty well for us. If you look at the company, we are the 52nd biggest company by market cap in the world. Qualcomm started only in 1985, so it hasn’t been a bad run. And we have a fair amount of money in the bank. We have $15 billion plus (in cash and equivalents). What happens is every year we look at the previous year and reinvest into R&D what we earned on R&D in the previous year from licensing the technology, to try to continue to stay ahead.

I think Qualcomm is a good example of what can happen if you have a good idea and you take a huge amount to risk to make it happen. I mean, we almost went out of business. Many a time, we were paying salaries through credit cards. The fact that we were able to build such a big company by coming up with a fundamental idea, I think, inspires a lot of people — to come up with the next big thing. I can’t tell you the number of times I hear a company come and visit us and say we are the next Qualcomm and I tell them, “You know what, that is a good thing to shoot for.” But let me tell you that it wasn’t easy to become the first Qualcomm. We took a lot of abuse early on. People even accused my father (founder Irwin Jacobs) of lying.

On the business ramp-up planned in India and China…
In China, we are looking at going from 30 million (mobile phone chipset sales) as at the end of last year to up to 200 and something by 2013. In India, we are at 90 million, going up to 230 million or something like that during the same time. These are huge ramp-ups. In India, we have a fairly large presence right now. We are looking to grow that.

On the social media revolution…
The social media is very important. What is going on in Twitter is very important. Twitter is a very real-time service. If you compare… Google is not as fast as Twitter. Twitter tells what happened right now. And the phone is really good for “what happened right now”. Flow TV (the mobile television technology that Qualcomm acquired and is now propagating) is really good for that because I can send out what is happening right now, not in 140 characters, but over rich media.

The form factor of mobile phone screens have kept changing with functionality. They have risen from 2 inches to 4 inches, whereas computer screens are compressing to around 10 inches. Where would the screen size of ideal smart phones stabilise?

There is definitely going to be things that can be fit into your pocket. The pocket is something that’s got to live with the form factor. You see people trying to get as big a screen as they can. The next thing that controls the screen is the keyboard size. Thumb keyboards… that’s a certain size. If you want a full-sized keyboard, that is then the next thing. So, basically, it will be a thing that you can carry around, that will be very thin and has a full-sized keyboard and 10-inch screen. To me, that could be the next thing that people would be interested in.

Nokia has already launched that…
Yes. Now the issue is, what kind of battery life does it have? Is it always on the network? All the things that you add to the device use battery power. So how do you produce that kind of battery power? That is why we are doing e-zone battery charging where in future all these devices that are sitting in an e-zone platter get charged by just being there. Battery life, I think, will get a little bit less important that way.

My personal belief is that people will carry around multiple devices. You carry around devices that are actually tailored for a particular use. So a camera that will be a phone inside… and maybe that camera will have a Bluetooth headset and that will be fine for some people. You go home and put it on your e-zone charger and pick up your small phone. You don’t do these things today because if you are gonna pick up the device you carry with you on a random basis, you will have to plug them all in so that they remain charged. But sitting on the e-zone platter they are all be charged automatically. I can pick up the Bluetooth one today, the camera one other day, the gaming some other time. Put them all back on the platter and they are all charged. That is going to make a big difference.

So life won’t be a one device thing?
I don’t think so.
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