Skip to main content

Is Qualcomm going up against Intel?

It's been months and months since I last wrote about Qualcomm (QCOM). The company has had a resurgence of sorts. The stock is actually showing a gain so far in 2009. They just increased their dividend at a time when so many other companies are slashing theirs.

So the question is, can they keep it up?

The company provided guidance during their last earnings conference call that indicated shipments would be down but not drastically, as sales of cell phones were expected to be weaker on a year-over-year basis. Still, the company expects to be a prime beneficiary of the roll-out of 3G in China. And they are feeling optimistic after resolving their legal problems with Nokia (NOK) and booking $2.5B to renew the license agreement.

Qualcomm may be acting a bit over-confident but, on the whole, there is little doubt that they will be one of the companies that will come out of this recession as a survivor.

What is interesting, however, is where the company's strategy seems to taking it. I'm talking about Snapdragon.

Snapdragon is Qualcomm's attempt to create a platform for mobile computing devices. They seem to have all the parts in place: 1GHz processor, digital signal processor, Wi-Fi, GPS, camera, high resolution graphics and TV, multiple audio formats and various wireless technologies including Bluetooth. The platform is optimized for low power usage and can be combined with different RF solutions such as Qualcomm's CDMA or the European standard GSM, as in the Toshiba TG01. That's right, Qualcomm already has a design win in the Toshiba device which is somewhat of an iPhone clone.

The Snapdragon platform is meant to run either Linux or Windows Mobile. Qualcomm demonstrated a prototype that runs Google's Android operating system, as well. The CPU is the ubiquitous ARM processor. With high quality graphics, the platform has the potential to be a hand-held gaming device. The company also suggests the platform as the basis for netbooks.

What does this remind me of? I recently wrote about the recent agreement between Intel (INTC) and Taiwan Semiconductor (TSM). This agreement signifies Intel's aspiration to become a serious player in mobile computing devices or, as Intel calls them, mobile Internet devices.

Whereas Intel is looking to provide the processing power and allow Taiwan Semiconductor to build the system components around the processor, Qualcomm is offering the platform as an integrated multifunction unit.

In both cases, the companies are looking out long-term. Except for smart phone applications, there really are no killer apps that are crying out for the devices being offered. Are they solutions in search of a problem?

It appears that both companies are looking at a trend that is becoming more and more prevalent. Design wins are becoming a function of how much integration can be offered by a vendor. By saving their customers the effort of designing and integrating multiple functions, these companies can offer greater value and a solution that is easier for the customer to mold into a finished product. This is the same story we heard from Skyworks Solutions (SWKS), for example.

In this competition, it looks like Qualcomm has a lead on Intel with respect to integration. Qualcomm is also a prime vendor in the cell phone industry whereas Intel is just scratching surface there. Still, Intel is already a major player in netbooks while Qualcomm has yet to see a Snapdragon-based netbook hit store shelves.

It will be interesting to see how this plays out as these two companies, leaders in their respective industries, increasingly find themselves competing with each other.

Comments

Popular posts from this blog

Running TradeRadar on Windows 7 and Windows 8

Development of the original TradeRadar Stock Inspector software was begun back in the days before Windows 7 and Windows 8 were available.

As these newer versions of Windows have become more popular, we have heard from some users that they are having problems installing and running TradeRadar on their newer PCs.

The good news is that TradeRadar will work just fine on Windows 7 and Windows 8. All you have to do is adjust the Windows Compatibility Settings to ensure TradeRadar runs as intended.

It is recommended that you can apply Compatibility Settings when running the initial installation; however, it is also possible to apply Compatibility Settings after the program has been installed.

Prior to installation
After downloading the install program, go to the folder where you have stored the TradeRadarStkInsp_7_Setup.exe or TradeRadarStkInsp_7_PRO_Setup.exe executable. Right-click on the executable file and select Properties. Click the Compatibility tab. Adjust the Compatibility mode to …

Unlock Stock Market Profits - Key #1

This is the first in an ongoing series of articles where I discuss what I feel are keys to successful investing. It is based on a post that provides a summary of the ten keys that individual investors should use to identify profitable stock trades. (Click here to read the original post)

There are two basic steps to investing. First, you need to find stocks that seem to have some potential. Then you have to determine whether these stocks are actually good investments. There are many stocks that at first glance look interesting, but further research reveals that there are too many negatives to warrant taking a position.

This first post in the series starts at the beginning: getting good investment ideas.

Key #1: If something special is happening to a stock, it will be reflected in some kind of unusual activity in the markets.

As individual investors, we will never be the first to know; however, unusual activity can be an early sign that allows us to follow the Wall Street professionals and …

Unlock Stock Market Profits - Key #4

This is the fourth article in a series of posts describing 10 tools to help you identify and evaluate good investing ideas. It is based on a post that provides a summary of the ten keys that individual investors should use to identify profitable stock trades. (Click here to read the original post)

With this fourth post, we will continue another step along the path of finding stocks that seem to have some potential. The first post in the series discussed how to use unusual activity to identify investing ideas. The second post described how to use stock screeners. The third post described how to use lists of new highs and new lows. This post will focus on identifying social or business trends in order to find investing ideas.

Information on new trends might turn up anywhere. In conversation with friends or business associates, in newspapers or magazines, on TV or though your work. The key is to be aware of trends and how they start, stop or change. We'll start by describing what to lo…