Qualcomm goes 4G with acquisition of Flarion

QUALCOMM, which successfully commercialised CDMA, looks set to perform the same trick with OFDM. All thanks to its recent acquisition of Flarion for $600 million. It acquired 300 patents with Flarion on OFDM technology

The huge benefit for Qualcomm is that while Flash Orthogonal Frequency Division Multiplexing (OFDM) technology was invented in Lucent's Bell Labs, Flarion now holds around 300 patents covering OFDM.

The catch is that network operators such as Japan's NTT DoCoMo (which took an early lead in 3G), have been looking to OFDM to provide the technology for 4G. Plus other 4G style technologies, including WiMax, also incorporate aspects of OFDM.

Qualcomm's new president , Steve Altman has been quoted as saying, "We are willing to license these patents on fair and reasonable terms." Those making WiMax hardware are obviously the firms Qualcomm now has in its sights.

Flarion was left vulnerable to such an approach from Qualcomm after its biggest potential customer for OFDM - Nextel - was acquired by Sprint.

Suddenly, Europe's 3G phone networks have a choice: both easier, and harder, than it was a month ago. Their problem was how to move into the internet. The next generation of cellphones was expected to be WCDMA, also Qualcomm-owned... but politics accidentally sabotaged the technology, by picking the 2.1 GHz frequency spectrum for 3G phones.

That technology, at 450 MHz, works very well indeed. As every technologist involved in setting the WCDMA standards for Europe warned, at 2.1 GHz, this isn't true. It works; it just doesn't work at all well inside buildings, and the economics of WCDMA 3G are consequently looking dodgy.

The big obstacle facing WCDMA is VoIP. To carry that, profitably, end to end, you need far more packet-like carrier systems than WCDMA can offer. The cost per bit per user is what matters; Flarion technology has been guestimated to offer between 10X and 30X what technologies like IMS can provide, even if you ignore the latency problems.

What's the alternative? The accepted technology is IP Wireless, which is the orthodox way of moving into broadband wireless data. Now, with Flarion having done a sterling job of selling Flash-OFDM to those countries which rejected the standard, accepted technology, Qualcomm was staring at the loss of its future royalty markets.