Qualcomm Qualcomm stands for Quality Communications. The company is headquartered in San Diego and operates mainly in the US, South Korea, China and Taiwan. The company has four business segments: Qualcomm CDMA Technologies (QCT), Qualcomm Technology Licensing (QTL) and Qualcomm Wireless & Internet (QWI). Qualcomm CDMA Technologies develops integrated circuits and system software for use in voice and data communications, networking, application processing, multimedia and global positioning systems products. These products and systems are used in mobile phones, tablets, laptops, data modules, wireless computers and gaming devices among others. Qualcomm’s circuits and processors perform modem functionality in wireless devices providing voice and data communication. QCT’s software enables components in mobile devices to interact with the circuits in the device. In 2012, Qualcomm sold around 590 million IC’s for wireless devices. Qualcomm has a widely licensed portfolio. In China, Qualcomm has more than 110 3G licensees and also more than 55 4GLTE licensees. Among some of the devices that Qualcomm’s Snapdragon circuits power are: Google Nexus5, Motorola’s Moto X, Nokia’s Lumia 1020, Samsung’s Galaxy S5, Xiamoi’s Mi3 and Sony XperiaZ2. QTL owns a wide array of patents in wireless protocol standards and derivatives that licenses to manufacturers. QTL charges license fees or royalties based on manufacturers wholesale sales. Qualcomm Wireless & Internet offers wireless information services, global positioning reports and fleet management to logistic companies. It also offers wireless and hardware services to network operators and also provides wireless communications involving government agencies. In FY 2013 it reported revenues for $16.7 B an increase of 38% vs previous year. Earnings before taxes were $3.2B. China is Qualcomm’s largest market providing around 40% of its total revenues. South Korea accounts for around 22%, Taiwan 14% and the US just about 5%. The rest comes from other countries around the world. Qualcomm employs 31,000 people around the world. Qualcomm’s main competitors are: Texas Instruments, Freescale Semiconductors, Intel, Marvell Technology Group, ST-Ericsson, among many others. SWOT Qualcomm’s strengths are its strong R&D capabilities, fueled by expenditures of around $3.9 billion. Investing in new generation technologies is crucial in the sector as rapid changes and constant innovation is common among competitors. Being the first mover provides an invaluable advantage, as many protocols and components are adopted as the standards. The biggest weakness of Qualcomm is the fact that its clients are highly concentrated. Around 20% of its revenue comes from Samsung and Apple’s manufacturing affiliates. The opportunity for Qualcomm is the increasing demand in tablets and smartphones, especially in Asian markets, such as China and other developing countries. Global smartphone shipments are expected to continue growing at around 30% annually. The threats for Qualcomm are the intense competition in the telecommunications industry, not only from other chip manufacturers, but also from major equipment companies. Also with so much innovation happening, there is a constant demand for upgrades to meet the requirements of new smartphones and tablets being developed. Interesting Facts In 1998 Qualcomm paid $18 million for the naming rights of Qualcomm Stadium in San Diego. The agreement lasts until 2017. Qualcomm is ranked as the 32nd best place to work by Fortune. In 2012, 11 billion cumulative Qualcomm chips were shipped. Questions - How can Qualcomm influence its clients, such as China Mobile, into adopting faster technologies such as LTE? - How does China’s infrastructure investment plans impact Qualcomm’s business?