Telco Turmoil

The 5G and telco industry whirlwind continues…

Bloomberg reported earlier this week that the U.S. Department of Justice (DOJ) is "leaning against approving T-Mobile’s proposed takeover of Sprint."

Apparently the "remedies" proposed by the wireless carriers earlier this week didn’t go far enough resolve the department’s concerns that the deal risked harming competition.

Next, the FTC won an antitrust case against Qualcomm in the Northern District of California, this just a few weeks after Apple and Qualcomm settled a major patent dispute.

The FTC has ordered a number of remedies to Qualcomm, including that the company must not condition of the supply of modem chips on a customer’s patent license status, and that the company must negotiate or renegotiate license terms with customers "in good faith under conditions free from the threat of lack of access to or discriminatory provision of modem chip supply or associated technical support or access to software," among others.

And not to be left out, the telco vice against China continues today with the U.K.’s chip design firm ARM reportedly in a leaked memo has told its staff it must suspend business with Huawei. A report from the BBC explained that "Arm’s designs form the basis of most mobile processors worldwide" and that the designs contained "U.S. origin technology," and therefore subject to the U.S. trade restrictions.

When the Chips Are Down

We now know more about the Apple/Qualcomm settlement.

It was all (or mostly) about 5G.

No sooner was the settlement announced that Intel announced it was pulling out of the 5G smartphone chip market.

Apple and Qualcomm’s six-year licensing agreement will help ensure the launch of the first 5G iPhone in 2020.

According to a report from Nikkei Asian Review, the settlement included an undisclosed payment to Qualcomm by Apple, which "several weeks ago asked its suppliers to begin testing the chipmaker’s 5G modems."

Intel told Nikkei Asian in a statement that there was "no clear path to profitability and positive returns in the smartphone little business. That said, 5G remains a strategic priority across Intel and we continue to invest in our 5G network infrastructure business."

Apparently, Apple had long been concerned that Intel could not meet its 5G schedule, likely prompting the settlement with Qualcomm.

Nikkei Asian notes that Intel had been the sole modem chip supplier for iPhones since 2018, which, ironically, were due to Apple’s legal dispute with Qualcomm

What to do when the chips are down?!

No Big (Qualcomm) Deal

First, let me thank the rest of the world for their concern for Austin, Texas, and the two horrific bombings that occurred here yesterday, and the other that killed another man on March 2nd. 

To recap, that’s three bombings in ten days that have left two people dead and three people wounded after opening packages left at their doors.

While police have suggested none of these packages were delivered by the usual suspects — USPS, UPS, FedEx, Amazon — it is enough to make you second guess picking up any package off your front porch.

Coincidence these bombings occurred the first full weekday swing of SXSW Interactive, where the world’s media has descended? Or that the bombs were all placed at the homes of minorities?  

Austin Police either don’t know or aren’t saying yet, but it’s hard not to harken back to Ted Kaczynski (the Unabomber), whose methods weren’t entirely dissimilar (although in his case Kaczynski was targeting individuals involved in developing modern technologies).

While we wait to learn more, President Trump has taken the recommendation of the Committee on Foreign Investment in the United States (CFIUS) and decided to block Broadcom’s proposed buyout of Qualcomm, citing national security concerns.

Despite Broadcom’s having agreed to move its headquarters from Singapore to the U.S. in an effort to save the deal, CNBC reports that both companies were ordered to immediately abandon it post haste.

But Bloomberg suggests there was more at stake, some geopolitical and technological chess being played by the world’s biggest state actors. 

Their suggestion: CFIUS was concerned Broadcom would cut back on R&D funding at Qualcomm, which in turn would strength China-based Huawei, giving Chinese companies like they and ZTE the upper hand in steering the direction of wireless communications development, most notably 5G. Never mind the fact that the U.S. House Intelligence Committee blacklisted Huawei and ZTE in 2012, again citing security risks.

Bloomberg reminds us that Huawei uses Broadcom’s chips in networking products such as the switches that direct data between connected computers…and Qualcomm also works with Huawei. So if China’s 5G (and beyond) standards start to become just that, well, it leaves the American telcos potentially out in the cold Beijing snow.

Huawei is among China’s top filers of international and domestic patents, ranging from data transmission to network security, and Bloomberg suggests Huawei may even own a 10th of essential patents on 5G, and has been “angling for full-scale of commercialization of 5G networks by 2020.”

There’s a lot of money, and ergo, influence, at stake in the 5G decision. And apparently it’s not one that the Trump Administration  wants to possibly leave in the hands of President Xi.

The Name Is Snapdragon

Qualcomm’s keynote theme at CES earlier this week was “Born Mobile,” but much of the company’s message seemingly got blinded by the medium and the blogging pilers on who couldn’t get beyond the discombobulated narrative and campiness to see the chips for the trees.

I explained earlier in the week that I’d never been to the Consumer Electronics Show in Las Vegas.

But that didn’t preclude me from taking in some of the Vegas geek chic tidings from afar, and last evening, take in some, I did.

For the last many years as people can count, Microsoft has been the keynoter that opened the show. But this year, Microsoft decided they had better places to show their wares, so Qualcomm was offered the opening keynote spot.

Qualcomm, yes, the mobile wireless chip manufacturer.

That’s where things got weird.

And it’s also where the Internet memes started going wildly out of control.  I saw some early coverage coming from CNET and the Verge that suggested Qualcomm’s event was going off the rails. Smelling blood on the prosceneum, I ran as quick as I could to the scene of the crime.

When I saw that Qualcomm had posted the full webcast (even before the full event could have been over), I decided to go and watch for myself.

Now, mind you, I’ve seen a lot of keynotes and speeches in my time, and even participated in content development for some, and so I have a lot of respect and admiration for those who effectively pull off such techno theatre.

And after watching the Qualcomm webcast end-to-end, there’s no question there was quite a bit of the theatre of the absurd.

It was a Daliesque technology dog’s keynote breakfast.

From the “Born Mobile” theme that spawned some semi-talented Generation M-sters spouting how they’d die if they lost their mobile oxygen, to Microsoft CEO Steve Ballmer apparently changing his mind and returning to CES long enough to hijack the Qualcomm stage to tell everyone how wonderful Windows8 mobile devices were, to  some Sesame Street Theatre and kid’s mobile apps to help them learn how to read (where were those when *I* was a kid?!), to director Guillermo del Toro demonstrating how Qualcomm technology had helped make his movies come across even more brilliantly using Ultra HD, to NASCAR to Archbishop Desmond Tutu to Maroon 5 (the rights for whom someone failed to get for the online audience…DOH!)…oy vey, I’d like to have seen some of IBM’s keynote handlers unleashed on this one.

But let’s not forget, this wasn’t theatre intended to have some  Shakespearean denouement with a three-act structure and staged fight scenes. You want  a fancy, well-produced show, head down the Strip and take in a Cirques du Soleil show or David Copperfield’s illusions at the MGM.

If you were just interested in learning what one of the leading mobile wireless manufacturers had to offer in its latest products in the marketplace, well, you could actually learn a few things.  I did.

In fact, as something of a mobile aficionado, I was surprised to learn how much I didn’t know about this key player in the mobile sector, and the Qualcomm keynote, despite some if its failings, I think delivered on the most important, bottom line component of a major tech keynote: to inform and educate me about its products and capabilities, and to set a strategic vision and tone for who they are and where they’re going.

Though “the vision thing” may have been made more murky by the Heinz 57 cast of characters, at the end of the 80 minutes, that itself was a statement, that their mobile technology was impacting all kinds of various and sundry lives and industries.

The information in the keynote also spurred me to want to go read more about SnapDragon and some of the virtual reality technologies Qualcomm’s been working on.

So, I encourage you to absolutely take a look at the Verge’s snarky, if humorous, read on the keynote, but then take a look at the keynote replay itself. 

Because though at some points you may very well cringe, and though may not be nobly entertained, you will also learn a few things about Qualcomm’s recent chip and related technology breakthroughs — none of the details of which seems to have found its way into the Verge’s keynote coverage.