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Nov 13, 2006Qualcomm Makes Headway in Europe and Against Nokia
NOV 13, 2006 10:37:00 AM | Add Comment (0) | Permalink

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Motorola will use Qualcomm chips in future Universal Mobile Telecommunications Service (UMTS) phones in a deal that could give Qualcomm leverage in an ongoing patent licensing dispute with Nokia.

The announcement, along with several others, also indicates a continuation of Qualcomm’s aggressive pursuit of the European market.

The Motorola agreement "is clearly something that is advantageous to Qualcomm in its battle with Nokia," said Ben Wood, an analyst with Collins Consulting in the United Kingdom.

Qualcomm and Nokia are embroiled in a bitter licensing renegotiation process as their current patent licensing agreement nears expiration in April. Nokia says that Qualcomm is charging more than is fair and reasonable for the patents that Qualcomm contributes to UMTS. Qualcomm may be hoping that the Motorola deal will help it prove that its terms are reasonable, because the number-two handset maker in the world agreed to them, Wood said.

The Motorola agreement also gives Qualcomm an important win in Europe, a market where it has traditionally been largely shut out. Because Nokia and Motorola are the two largest handset sellers in Europe, Texas Instruments and Freescale Semiconductor, their main chip suppliers, have supplied the vast majority of chips in Europe, Wood said.

The deal with Motorola could help Qualcomm sell other products in Europe as well because the chips support other Qualcomm technologies. "There are some logical synergies between the growing proportion of 3G handsets powered by Qualcomm and the potential for operators to deploy Brew because it’s built into the chipsets," Wood said. Brew is a mobile application development platform built by Qualcomm.

Qualcomm on Monday announced that Telecom Italia’s mobile arm, TIM, is the first operator to commercially launch services using Brew in Europe. TIM customers can choose from two handsets, one from Samsung Electronics and one from Onda, that support the service, which enables mobile games and a customizable user interface. The availability of Motorola handsets that include Qualcomm’s chips and thus support Brew could help TIM sell the service and also encourage other European operators to use Brew.

Brew competes with Nokia’s S60 mobile phone software and Java as a development platform for mobile applications.

Qualcomm made another announcement on Monday, coinciding with a visit to Europe by Qualcomm’s chief executive officer to meet with analysts, which indicates its commitment to the European market.

Qualcomm introduced a new single chip product for Global System for Mobile Communications (GSM). One of the new chips includes wideband code division multiple access (WCDMA), GSM, General Packet Radio Service and Enhanced Data Rates for GSM Evolution). The other includes all of those technologies plus high-speed downlink packet access (HSDPA). Qualcomm says they are the first chips to include an integrated radio transceiver, baseband modem and multimedia processor along with power management function into a single chip for WCDMA and HSDPA phones.

Qualcomm has made other headway into Europe recently. Earlier this year, British Sky Broadcasting began a trial of Qualcomm’s mobile TV system, MediaFLO. MediaFLO competes with other standard mobile TV technologies, such as DVB-H. Qualcomm had scheduled a press event for Tuesday with MediaFLO group to discuss the trial’s results, but the event was abruptly canceled. A spokesman for Qualcomm’s media relations firm said BSkyB had decided to postpone the announcement probably for another month or so.

-Nancy Gohring, IDG News Service (Dublin Bureau)

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