Qualcomm Buys Wireless Chip Makers

UPDATED: Qualcomm’s acquisition today of two wireless chip makers is a signal that its rivalry with silicon giant Intel is
getting personal.

Qualcomm said it will integrate RF Micro Devices’ Bluetooth assets and Airgo’s
802.11a/b/g and 11n technology into its Mobile Station Modem (MSM) chipsets.
The wireless technology will also become part of Qualcomm’s Snapdragon
platform for mobile broadband connectivity, according to a statement.

Although few financial details of the acquisition of privately held Airgo
Networks and RF Micro Devices were disclosed, the value to Qualcomm is

In a statement, Sanjay Jha, president of Qualcomm’s CDMA Technologies
unit, said the acquisitions will give the chip maker’s partners
“comprehensive chipsets with seamlessly integrated features.”

The acquisitions also illustrates the growing importance of personal area
networking, a realization that came late to Qualcomm.

Focused for too long on wide-area networking, Qualcomm let Bluetooth and
Wi-Fi go, Chris Ambrosio, director of wireless research at Strategy
Analytics, said.

The acquisitions close that gap for Qualcomm and cut the lead Intel may
have from Freescale and other wireless ventures, he said.

“This brings them up a notch,” Ambrosio said. Without today’s purchases,
Qualcomm “would have been relegated to the edges” of wireless networking.”

Both technologies are used to transfer multimedia, an area specially suited
to RF Micro. RF Micro’s Bluetooth Enhanced Data Rate (EDR) technology, used
in mobile handsets and headsets, will become part of Qualcomm’s MSM design.

“Qualcomm now effectively owns a stake in the Bluetooth market that will
enable it to expand in the CE (consumer electronics) environment with greater
ease, due to the growing profile of Bluetooth in the gaming, PMP and music
player markets,” ABI Research analyst Stuart Carlow, said in a statement.

On the Wi-Fi side, Airgo has played an active role in the much-anticipated
802.11n wireless standard, providing greater distance and speed, as well as
less interference for local wireless networks. Qualcomm announced yesterday
the first chipset from Airgo, which supports Draft 2.0 of 802.11n.

Although Airgo’s addition will help Qualcomm gain more Wi-Fi market
share among cellular modem vendors buying Wi-Fi or 3G chipsets, “the
powerful Intel Centrino brand will be a significant obstacle to Qualcomm’s
success in that sector,” ABI Research senior analyst Philip Solis said in a

The acquisitions are expected to close by the end of 2006, according to a

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