CREATING QUALCOMM
A CASE STUDY REVIEW BY NWANKWO EMMANUELWELCOME
© nwankwo emmanuel. 2010. All rights
reserved.
For more than 20 years,
Qualcomm has developed
technologies that provide
solutions to wireless
telecommunications operatin...
CALIFORNIA
ARIZONA
TEXAS
Pennsylvania
NEW YORK
Maryland
Virginia
San Diego, California – where Qualcomm started
New York
C...
1991198919881985
QUALCOMM TIMELINE FROM 1985 - 1991
Qualcomm lands
its first contract
and began
working with
CDMA
first ma...
• Form of spread-spectrum, a family of digital
communication techniques, been used in military
applications for many years...
• Originally, there were two motivations:
– resist enemy efforts to jam the communications (anti-jam).
– hide the fact tha...
Multiple Access (MA) analogy
• An analogy to the problem of multiple access is a room
(channel) in which people wish to co...
Let’s
go to
Aegis
Ok,
JAM
Nahīṁ
samajhatē
maiṁ
Je ne
comprends
pas
Das
verstehe
ich nicht
© nwankwo emmanuel. 2010. All ri...
Broadband application of CDMA technology.
Dial-up Internet - 2 minutes
Broadband Internet - 2 minutes
An illustration of h...
We have always been in the semiconductor
business
• Our first hardware deliverable product was a full custom Viterbi
algor...
QUALCOMM's Aim
Full scale adoption of CDMA by
a major carrier
Conditions
Convince Organizations to commit to
Jacob’s dream...
QUALCOMM
R&D
SUBSCRIBERS
INTELLECTUAL
PROPERTY
RIGHTS
SERVICES &
APPLICATIONS
New
Ideas
Licenses
Devices
With advanced
Fea...
Strengths
•Experience in Satellite technologies.
•Experience in Spread spectrum.
•Technical services deployment experience...
Why do firms cooperate in technical standardization?
Industrial dynamics (Schematics)
The economic Industrial Organization...
OOTP
I.M.JACOBS
A.J.VITERBI
H.P.WHITE
DEVELOPMENT
FINANCE
ENGINEERING
DIRECTOR
COMML PROG. GOVT. PROG.
QUALITY ASSURANCE S...
Service providers Network equipment
suppliers
Subscriber equipment
suppliers
Ameritech AT&T AT&T
NYNEX Motorola Motorola
P...
Exhibit 4: Excerpt from Qualcomm Form S-1 Registration
Source: Form S-1 SEC Registration Statement, December 4, 1991
© nwa...
Source: Form S-1 SEC Registration Statement, December 4, 1991.
Exhibit 5: Qualcomm Financials – 1987 – 1991
(All amounts a...
SEC Registration Statement?
© nwankwo emmanuel. 2010. All rights
reserved.
SEC Registration Statements have two
principal parts:
Part I is the prospectus, the legal offering or
"selling" document. ...
SEC Registration Statements, Part two
Part II contains additional information that the
company does not have to deliver to...
The Basic Registration Form - Form S-1
All companies can use Form S-1 to register their securities offerings. You
should n...
Additional Information to form S-1
In addition to the information expressly required by the
form, your company must also p...
References
• http://www.sec.gov/edgar.shtml
• http://www.sec.gov/
• http://www.secinfo.com/
• http://idv.sinica.edu.tw/kon...
QUESTIONS?THANK YOU
FOR LISTENING
Hope the session was informative?
© nwankwo emmanuel. 2010. All rights
reserved.
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Cdma Early Days Creating Qualcomm

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  • To view this presentation, first, turn up your volume and second, launch the self-running slide show.
  • The economic Industrial Organization theory suggests that it is very important for firms in network technology markets to gain a sufficient market share for products and technology platforms.
    Strategically, it is then essential for firms to be among the first to enter new network markets and to obtain a critical market share. Otherwise they may be forced to switch to the competing technology or exit the markets altogether.
  • Cdma Early Days Creating Qualcomm

    1. 1. CREATING QUALCOMM A CASE STUDY REVIEW BY NWANKWO EMMANUELWELCOME © nwankwo emmanuel. 2010. All rights reserved.
    2. 2. For more than 20 years, Qualcomm has developed technologies that provide solutions to wireless telecommunications operating companies and their subscribers. Let’s do a review… CREATING QUALCOMM
    3. 3. CALIFORNIA ARIZONA TEXAS Pennsylvania NEW YORK Maryland Virginia San Diego, California – where Qualcomm started New York City Los Angeles Houston Chicago Philadelphia Phoenix San Antonio San Diego Dallas San Jose Washington DCILLINOIS This is home to Qualcomm, where Dr. Irwin M. Jacobs, Dr. Andrew Viterbi, Harvey White, Franklin Antonio, Andrew Cohen, Klein Gilhousen, and Adelia Coffman founded Qualcomm.
    4. 4. 1991198919881985 QUALCOMM TIMELINE FROM 1985 - 1991 Qualcomm lands its first contract and began working with CDMA first major OmniTRACS order from Schneider National Trucking Company Qualcomm placed a demonstration that changed wireless history in San Diego, California on November 7, 1989 December, IPO conducted making 4 million shares available to the public on NASDAQ Qualcomm pioneers M2M communications August 1988, the Company launches OmniTRACS Qualcomm makes a historic phone call, CDMA is proven. Qualcomm becomes a public company Qualcomm founded in July, 1985. © nwankwo emmanuel. 2010. All rights reserved.
    5. 5. • Form of spread-spectrum, a family of digital communication techniques, been used in military applications for many years. • Core principle of spread spectrum is the use of noise-like carrier waves. • Introduced in 1995, CDMA quickly became one of the world's fastest-growing wireless technologies. • 1999, International Telecommunications Union selected CDMA as the industry standard for new "third- generation" (3G) wireless systems. CDMA (Code Division Multiple Access) © nwankwo emmanuel. 2010. All rights reserved.
    6. 6. • Originally, there were two motivations: – resist enemy efforts to jam the communications (anti-jam). – hide the fact that communication was even taking place, sometimes called low probability of intercept (LPI). (history dates back to the early days of World War II). • Proposed theoretically in the late 1940's, but practically in the civilian marketplace 40 years later. • Commercial applications became possible because of two evolutionary developments: – availability of very low cost, high density digital integrated circuits, which reduce the size, weight, and cost of the subscriber stations to an acceptably low level. – realization that optimal multiple access communication requires that all user stations regulate their transmitter powers to the lowest that will achieve adequate signal quality. CDMA evolution, how? © nwankwo emmanuel. 2010. All rights reserved.
    7. 7. Multiple Access (MA) analogy • An analogy to the problem of multiple access is a room (channel) in which people wish to communicate with each other. • To avoid confusion, people could take turns speaking (time division), speak at different pitches (frequency division), or speak in different languages (code division). • CDMA is analogous to the last example where people speaking the same language can understand each other, but not other people. • Similarly, in radio CDMA, each group of users is given a shared code. Many codes occupy the same channel, but only users associated with a particular code can communicate. © nwankwo emmanuel. 2010. All rights reserved.
    8. 8. Let’s go to Aegis Ok, JAM Nahīṁ samajhatē maiṁ Je ne comprends pas Das verstehe ich nicht © nwankwo emmanuel. 2010. All rights reserved.
    9. 9. Broadband application of CDMA technology. Dial-up Internet - 2 minutes Broadband Internet - 2 minutes An illustration of how 1Mb of Emails is delivered by Internet connection 1 × 1MB emails Many 1MB emails © nwankwo emmanuel. 2010. All rights reserved.
    10. 10. We have always been in the semiconductor business • Our first hardware deliverable product was a full custom Viterbi algorithm decoder chip ~ 1987 • We have always recognized that the key to feasibility of CDMA was VERY aggressive custom chip design • First chip sets required three devices for a mobile phone – 1991 • Second go around compressed the original 3 chip design into a single chip enabling a fully functional dual mode AMPS/CDMA phone – 1992 • Third generation enabled the first commercial dual mode AMPS/CDMA phone – the QCP-800 - 1995 • Now focused on chip business leaving phone and base station products to others …CDG(CDMA Development Group)© nwankwo emmanuel. 2010. All rights reserved.
    11. 11. QUALCOMM's Aim Full scale adoption of CDMA by a major carrier Conditions Convince Organizations to commit to Jacob’s dream (CDMA) Convince Standard-setting body to standardize CDMA Convince carriers to use CDMA-based service Equipment manufacturers committing to Large-scale production of CDMA-based equipment Convince consumers with better Quality of Service while transitioning. Strategy to market CDMA © nwankwo emmanuel. 2010. All rights reserved.
    12. 12. QUALCOMM R&D SUBSCRIBERS INTELLECTUAL PROPERTY RIGHTS SERVICES & APPLICATIONS New Ideas Licenses Devices With advanced Features Advanced Devices and Services Increased Operator ARPU Increased Manufacturer Revenue Increased R&D MANUFACTURER S Chip Sales OPERATORSINNOVATE Exhibit 3: Qualcomm’s Business Model© nwankwo emmanuel. 2010. All rights reserved.
    13. 13. Strengths •Experience in Satellite technologies. •Experience in Spread spectrum. •Technical services deployment experience. •Outstanding name reputation. •Top-notch scientists and engineers. •Modified OmniTRACS to a two-way system. •Team spirit. •Theoretical and practical knowledge of the CDMA technology. S Weaknesses •Not financially buoyant for satellite. •Little knowledge of haulage business. •Technology not adopted in open market. •One-way system of initial OmniTRACS products. •Insufficient funds for R&D. •CDMA not yet deployed terrestrially. W Threats •Geostar’s two-way tracking sytem. •CDMA not been deployed in purchasable equipments. •TDMA was the initial wireles standard deployed and was adopted by carriers. •CDMA not yet standardized by the Standards-setting bodies. •Huge capital needed to roll out working prototypes. T Opportunities •Alliances with Omninet, PacTel and Nynex. •OmniTRACS contract for Schneider. •First to explore CDMA technology in the commercial market. •Existing ku-band television satellite system. •PacTel Cellular was running out of capacity. •TDMA could only offer at most two years of growth headroom to carriers. •Geostar headed for insolvency. •CDMA is backward compatible. O Primary factors SWOT ANALYSIS DURING THE YEARS 1987 - 1991 © nwankwo emmanuel. 2010. All rights reserved.
    14. 14. Why do firms cooperate in technical standardization? Industrial dynamics (Schematics) The economic Industrial Organization theory suggests that it is very important for firms in network technology markets to gain a sufficient market share for products and technology platforms. demand-side network externalities (Katz and Shapiro 1985) supply-side scale economies (Klepper 1996, Simons 2003), both of which generate first mover advantages REASON the convergence of markets towards one technology subsequent adopters to buy products based on this platform market share of the winning technology growing initially at an exponential rate be among the first to enter new network markets and to obtain a critical market share© nwankwo emmanuel. 2010. All rights reserved.
    15. 15. OOTP I.M.JACOBS A.J.VITERBI H.P.WHITE DEVELOPMENT FINANCE ENGINEERING DIRECTOR COMML PROG. GOVT. PROG. QUALITY ASSURANCE SECURITY CONTRACTS/ PURCHASING HUMAN RESOURCES ADV. ENG SYS. ENGINEERING OPERATIONS TECHNOLOGY DIRECTOR DIRECTOR DIRECTOR DIRECTOR ● New College Grad o New Hire Exhibit 1: Qualcomm Organization Chart (1987) © nwankwo emmanuel. 2010. All rights reserved.
    16. 16. Service providers Network equipment suppliers Subscriber equipment suppliers Ameritech AT&T AT&T NYNEX Motorola Motorola PacTel cellular Northern Telecom Oki Electric Bell atlantic mobile Alps Electric Bell cellular Canada Clarion Corporation GTE Nokia Mobile Us West New Vector Sony Corporation Exhibit 2: US wireless industry market participants Source: form S-1 SEC Registration Statement, December 4, 1991 © nwankwo emmanuel. 2010. All rights reserved.
    17. 17. Exhibit 4: Excerpt from Qualcomm Form S-1 Registration Source: Form S-1 SEC Registration Statement, December 4, 1991 © nwankwo emmanuel. 2010. All rights reserved.
    18. 18. Source: Form S-1 SEC Registration Statement, December 4, 1991. Exhibit 5: Qualcomm Financials – 1987 – 1991 (All amounts are in thousands, except per share data) © nwankwo emmanuel. 2010. All rights reserved.
    19. 19. SEC Registration Statement? © nwankwo emmanuel. 2010. All rights reserved.
    20. 20. SEC Registration Statements have two principal parts: Part I is the prospectus, the legal offering or "selling" document. Your company - the "issuer" of the securities - must describe in the prospectus the important facts about its business operations, financial condition, and management. Everyone who buys the new issue, as well as anyone who is made an offer to purchase the securities, must have access to the prospectus. © nwankwo emmanuel. 2010. All rights reserved.
    21. 21. SEC Registration Statements, Part two Part II contains additional information that the company does not have to deliver to investors. Anyone can see this information by requesting it from one of the SEC's public reference rooms or by looking it up on the SEC Web site. © nwankwo emmanuel. 2010. All rights reserved.
    22. 22. The Basic Registration Form - Form S-1 All companies can use Form S-1 to register their securities offerings. You should not prepare a registration statement as a fill-in-the-blank form, like a tax return. It should be similar to a brochure, providing readable information. If you file this form, your company must describe each of the following in the prospectus: • its business; • its properties; • its competition; • the identity of its officers and directors and their compensation; • material transactions between the company and its officers and directors; • material legal proceedings involving the company or its officers and directors; • the plan for distributing the securities; and the intended use of the proceeds of the offering. © nwankwo emmanuel. 2010. All rights reserved.
    23. 23. Additional Information to form S-1 In addition to the information expressly required by the form, your company must also provide any other information that is necessary to make your disclosure complete and not misleading. You also must clearly describe any risks prominently in the prospectus, usually at the beginning. Examples of these risk factors are: • lack of business operating history; • adverse economic conditions in a particular industry; • lack of a market for the securities offered; and • dependence upon key personnel. © nwankwo emmanuel. 2010. All rights reserved.
    24. 24. References • http://www.sec.gov/edgar.shtml • http://www.sec.gov/ • http://www.secinfo.com/ • http://idv.sinica.edu.tw/kongpin/teaching/io/ KatzShapiro1.pdf • http://www.wikipedia.com © nwankwo emmanuel. 2010. All rights reserved.
    25. 25. QUESTIONS?THANK YOU FOR LISTENING Hope the session was informative? © nwankwo emmanuel. 2010. All rights reserved.

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