Qualcomm 2002 Annual Report Download - page 35

QUALCOMM 2002 ANNUAL REPORT PAGE 33
As part of our ongoing effort to promote and support the spread of CDMA tech-
nology, QUALCOMM’s global development team works closely with operators and
equipment manufacturers throughout the world to make sure that the transition to
third-generation services is fully supported and economically successful.
NEW OPPORTUNITIES
One way that we provide support is through working closely with operators and
manufacturers on our technology roadmap including our rapidly evolving CDMA
chipsets and our BREW (Binary Runtime Environment for Wireless) platform.
QUALCOMM CDMA Technologies achieved record sales this year as a result
of steadily increasing demand for our industry-leading chipsets (integrated
circuits and system software) which provide our customers with advanced
capabilities and compelling economics.
Our Company is privileged to employ many of the best CDMA engineers in
the world today, enabling us to amass a rapidly growing patent portfolio. The
QUALCOMM Technology Licensing arm of our business collects royalties and
licensing fees from manufacturers who utilize our CDMA patent portfolio for
the design and production of infrastructure equipment for networks, phones
and other devices such as wireless modem cards and PDAs. This year we
achieved a significant milestone in the licensing business when agreements
were signed with both Alcatel and Siemens, signifying that QUALCOMM has
now become a technology partner and often a key supplier to virtually every
major manufacturer in the wireless industry.
The CDMA technology we pioneered now accounts for approximately 20 percent
of the worldwide wireless communications market, and the percentage is
growing. CDMA technology has been adopted by almost all companies for
third-generation networks for good reason: It provides higher quality and more
efficient use of expensive spectrum for both voice and data, is cost-effective,
and enables a broad range of devices and services.
NEW APPLICATIONS AND SERVICES
Now that the high-speed wireless “pipeline” has been enabled, QUALCOMM
is working with operators, device manufacturers and software developers
worldwide to ensure an increasing flow of applications tailored to consumers’
individual needs for information, entertainment, commerce, business and security.
Our BREW initiative provides support for software developers, device manufac-
turers and wireless operators, arming them with technology tools and an
end-to-end business model to bring new applications to worldwide markets,
independent of network technology. This year BREW really took off, with opera-
tors in South Korea, Japan and the Americas launching wireless data services,
all with strong customer acceptance. We are evolving BREW to even further
support manufacturers to more rapidly test and bring to market phones and
devices that utilize the broad range of advanced capabilities enabled by our
chips and system software. With instant messaging, music downloading, games,
mobile commerce, mapping and navigation, personal information management
(PIM) functions, browsers, security and a range of vertical business applications,
BREW-based services have proven to increase operator revenues and customer
retention rates.
NEW TECHNOLOGIES AND DEVICES
One of the more exciting examples of this was the commercial launch of
navigation services via BREW-enabled phones using QUALCOMM’s gpsOne
technology. Network software developed by our SnapTrack subsidiary
communicates with the QUALCOMM chipsets in wireless phones to enable
location-based services like personal navigation. Today there are more
than five million gpsOne-enabled devices in commercial use in Asia and
North America.
Several wireless operators in the U.S. are selling gpsOne-enabled phones to
meet the E-911 wireless safety obligation mandated by the federal government.
Using QUALCOMM’s powerful technology, Sprint PCS and Verizon Wireless are
already achieving the enhanced safety of E-911 services in many regions of the
United States. QUALCOMM’s gpsOne technology has quickly become the
world’s most widely deployed position location system for mobile phones.
Other noteworthy technology breakthroughs at QUALCOMM this year included
the on-time shipment of our multimedia chipset with features that support
digital camera phones and streaming video and music downloads. We began
sampling our MSM6xxx family of chips based on radioOne technology, which
eliminates the intermediate frequency components, simplifying and reducing
the cost, space, and power for phones and devices, especially those that sup-
port multiple frequency bands, position location and Bluetooth™. radioOne also