Admitting the obvious: Qualcomm knifes UMB

Admitting the obvious, CEO Paul Jacobs told analysts Thursday that Qualcomm is giving up on UMB. The Reuters story (referenced by Unstrung) is the only account I could find:

NEW YORK (Reuters) - Qualcomm Inc, seeking to cut costs in the face of slowing demand for cell phones, has stopped developing a next-generation wireless technology called Ultra Mobile Broadband.

The wireless chip maker will put its resources into a rival high-speed technology called Long Term Evolution, which some of its major customers, such as Verizon Wireless, have backed, said Qualcomm Chief Executive Paul Jacobs.

As I noted in April, Qualcomm’s hope of getting its UMB adopted died when one of its two major cdma2000 customers in the US, Verizon Wireless, went with LTE.

It’s funny how Qualcomm chose to announce this. The only 2008 press release mentioning UMB is a February announcement of their planned UMB/LTE chipsets (presumably now LTE only). In a (Qualcomm-enabled) search for UMB on the Qualcomm website, 6 of the first 15 links went to missing documents (presumably pro-UMB marketing materials that have now been removed). I grabbed the various UMB white papers (still there) for posterity.

The 2006 annual report (from December 2006) predicted UMB would be commercialized in 2009. In March 2007, Qualcomm announced a “complete solution” for UMB in time for CTIA.

With UMB dead, tweaks to EVDO will not be enough to justify keeping 3GPP2 alive forever; given their overlapping membership, perhaps they can negotiate a friendly takeover by 3GPP. At some point, the raison d’être for CDMA Development Group will also disappear.

As I also noted in April, early cdmaOne (then IS-95) fan (then Vodafone CEO) Arun Sarun urged the industry to favor LTE over WiMax. Qualcomm is in the odd position — for the first time in more than 15 years — of not having its own horse in the mobile standards race, but instead watching its previous rivals duke it out.

Still, Qualcomm’s new alliance is clear. With HSDPA/USDPA, Qualcomm has been contributing to improvements in W-CDMA and getting closer to the 3GPP telecom crowd, and now with the Nokia patent dispute settled, Qualcomm is a respected (and perhaps even respectable) figure in Sophia-Antipolis.

Meanwhile, Qualcomm is like Nokia in that it would just like Intel and WiMax to go away or find a tiny niche (like small-town last-mile distribution). Most of the world’s carriers are in the same camp. The one obvious exception is Qualcomm’s other major CDMA carrier, Sprint, with a huge bet on WiMax (bankrolled by Intel). I wonder if we will see other evidence of increasing distance between Qualcomm and Sprint.

Conversely, Qualcomm is proudly providing the chip for T-Mobile’s new gPhone. Perhaps Qualcomm will gain enough WCDMA/LTE share to make up for the shrinking CDMA market.

The Reuters story also said Qualcomm hopes to use its (ARM core) Snapdragon CPU to expand revenues beyond cellphones to pocket computers or laptops. This seems like a tough slog, as PC sales are also expected to decline and many firms (beyond Intel) will be trying to gain market share in anything that needs a CPU.