Qualcomm CEO Says 5G Coming Sooner, Aiming to Repeat Dominance

  • Fewer companies investing in wireless technology R&D: CEO
  • Chipmaker aiming to be ‘big winner’ in fifth generation

Qualcomm Inc., whose chip technology is at the center of all modern smartphones and wireless networks, intends to keep its dominant position as new high-speed services debut sooner than expected.

Fifth-generation mobile devices and networks, planned for 2020, will be rolled out at least a year earlier than that target date, according to Qualcomm Chief Executive Officer Steve Mollenkopf.

“We want to be the big winner,” Mollenkopf said in an interview. “It’s time for us to start talking about it.”

He’s trying to position the company as the leader in the next evolution of wireless technology. 5G speeds up mobile data ahead of an expected wave of new connected devices ranging from cars to light bulbs. Rivals such as Intel Corp. have said they will use disruption caused by this new technology to break into Qualcomm’s mobile internet turf. 

That’s happened in the past to previously dominant mobile companies such Nokia Oyj, Motorola and Texas Instruments -- the leading mobile chipmaker that Qualcomm displaced -- when they were slow to recognize the importance of new technology.

Unlike previous generations of wireless technology, there are fewer companies investing research and development this time round. Mollenkopf said that means only companies with a broad range of capabilities will become meaningful suppliers for 5G -- which aims to support services ranging from self-driving vehicles to remote automated surgery.

“Fewer companies are pulling the big load and we’re one of them,” he said. Leadership in current 4G technology, and the ability to develop chips that work on limited battery power, will be key, he said.

Qualcomm has benefited greatly as phones evolved from voice devices into mobile computers we look at and touch. Qualcomm is unique among chipmakers in getting the majority of its profit from licensing patents for technology that underpins modern phone networks. The bulk of its sales come from chips that connect phones to those networks and run programs on smart devices.

Since 2002 when the first 3G networks became commercially available, Qualcomm has collected $56 billion in technology licensing fees. Last year, that revenue totaled about $8 billion. Only four other U.S. chip companies exceeded that in total sales.

Qualcomm’s CEO has plenty of business reasons to want the next leap forward to come as soon as possible. As 4G has matured, growth has slowed and some phone makers have turned to other suppliers. That’s contributed to four straight quarters of more than 10 percent revenue declines for the company. It broke that streak in the three months ended June with new chips that won more orders in China.

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