Saturday 12 July 2008

Qualcomm to make Femto-Intelligent Handsets

The last time I read about Qualcomm bying stake in Femtocell maker Ip.Access, I overlooked it but now the rumors are that they want to be the leaders in Femto-Intelligent handsets. This fits well with Femto-optimised handsets plan that I blogged about.

Ovum had interesting analysis on the original news:

It's easy to see, though, how femtocells fit into Qualcomm's vision of the future of the wireless world. It's not too much of an exaggeration to say the company believes that the WCDMA radio technology is so good that no other is needed; curiously, ip.access's other industry investors, including Cisco and Motorola, are much more closely associated with the opposite position. Some years ago Qualcomm engaged in a sustained rubbishing of WiFi as a public access technology, and more recently it has given WiMAX the same treatment. Femtocells could be a route towards using WCDMA in home and other internal networking.

The reality may be more prosaic. According to Qualcomm Ventures' self-description, its “aim is to support Qualcomm's mission of enabling and fostering 3G (WCDMA) and wireless Internet markets through strategic investments in privately owned startup ventures.” With femtocells at least a plausible runner in the medium term in the future development of public mobile networks, not investing anywhere in the technology might almost be deemed remiss. In Qualcomm's own words, both it and ip.access “have developed key intellectual property for femtocells, share the same vision for femtocells, and can work together to make the most effective use of these ideas for the benefit of the whole femtocell industry.”

From ip.access's perspective, the deal is somewhat more straightforward. It believes that Qualcomm is buying in because of its technological excellence and 'traction' with operators - it claims involvement in a number of femtocell trials with major MNOs, though none of these has been publicly disclosed.

For ip.access, the money Qualcomm is bringing is less interesting than the relationships and influence - especially with standards organisations - that it adds. Privately held, the company already lists Cisco, Intel Capital, ADC and Motorola Ventures among its owners. Neither party is disclosing the extent of Qualcomm's investment, or whether it will have any significant impact on the balance of shareholdings.

We are still mildly sceptical about the femtocell business case; even though ip.access provides some interesting data on the impact that domestic femtocells can have on the capacity requirements for the macro network. But it's clear that Qualcomm's decision to buy into ip.access makes the proposition rather more credible.

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