QUALCOMM FUMBLES AT 'SUPER TECHNOLOGY BOWL'
by Joe Shea
American Reporter Correspondent
TORREY PINES, Calif., Jan. 23, 2002 -- On the eve of the Super Bowl at Qualcomm Stadium, here along the lush green links of the Torrey Pines Golf Club in the faux Greene & Greene grand luxe of The Lodge at Torrey Pines, Qualcomm founder and CEO Dr. Irwin Jacobs rolled out his executive front line for a bank of high-tech reporters who mostly asked questions replete with a bewildering array of the abbreviations that define the ailing wireless industry, in which Qualcomm, with its chips in 135 million cell phones, is the dominant player. On Thursday, though, Qualcomm fumbled.
Drawn like moths to the flame of Jacobs' brilliance - and the promise of one-on-one interviews with one of the nation's richest and most influential businessmen - the questions were mostly softballs until an hour-long panel discussion and Q&A ended and Jacobs abruptly disappeared, trailing a bevy of beautiful p.r. ladies bearing apologies back to the press in his wake.
The American Reporter, though, stuck around for several hours of catch-up conversation with Qualcomm's Principal Engineer, David Clapp, who has worked at Jacobs' side since 1983, when the wireless technology known as CDMA that now underlies cellular technology in most of the United States and much of Asia, was in its infancy.
Clapp, an MS victim who gladly crawled around the plush lounge at The Lodge to find a power strip for us and spent more than two hours explaining the complex G3 technology the company is rolling out to customers from all over the world at a four day conference here this week, proudly showed off an an amazing array of futuristic hand-held devices powered by new Qualcomm chips, and most importantly, the CDMA200-1X EvDO wireless technology that will allow companies like Verizon and Sprint to let their customers send everything from simple text messages to full-motion video streaming across the frequency spectrum at speeds up to 2.4 million bytes per second - and even at affordable rates.
The technology was most compellingly demonstrated when Clapp put a $149 PMCIA wireless card with two tiny antennae at each side into a laptop and downloaded a 2MB file from a Qualcomm site to the laptop in just 46 seconds. That capability is real; a company called Monet, which is headquartered in Seattle but setting up shop in Upper Midwest college towns like Duluth, Minn., Fargo, N.D., and Eau Claire, Wisc., is offering CDMA200-1X EvDO (that last isn't a Michael Jackson flick, but "Evolution Data Optimization"), for $40 a month with speeds at or better than a cable modem.
But there is a rub. This weekend, Verizon and Sprint are both here at the conference mulling over Qualcomm's pitch of EvDO, since most have already quietly upgraded to CDMA2000-1X, but are reluctant to risk the big bucks that the EvDO format requires of them. Just this morning, a big article in the Washington Post (mostly sourced by Verizon, sources told us), sung the praises of the new technology, which unlike the popular WiFi doesn't require close proximity to a cell station but warned that it may not get adopted quickly.
We wanted to see it in action, so Clapp rolled out several phones and almost identically replayed the same set of problems that a frustrated demonstrator experienced at the Sony Ericsson P800 launch at the Hollywood Palace two weeks ago (see below: "It Films, Files and Flops: The P800 Is Convergence Gone Wild", Jan. 10. 2003).
As with that device, made with an Ericsson chip coupled to a Sony design, with Qualcomm's chipset there was a long string of authentication problems (the encryption technology is at a high-level on these devices), followed by failing batteries and diverse connectivity issues. As the Sony Ericsson guy had also said, the phone that worked was elsewhere, Clapp explained.
Perhaps Dr. Jacobs had it. At the press conference, the good doctor held up a camera that demo-ed streaming video but like the P800 demonstrator model, it was not from the scene before him but from a previously loaded file.
So, again, a huge expense and large press contingent failed to produce the object of it all: a working full-motion video telephone that you can use to send pictures of your bald spot to whoever's hunting for your scalp. As with the P800 demonstrator, Clapp had a variety of explanations and apologies, and in the end a rueful apology for a technology that is loaded with promise but never seems to come through.
The wireless card is also a bit of an illusion, Clapp later explained; the speeds he achieved in downloading the Qualcomm PowerPoint charts and The American Reporter's byte-heavy American Arts section, are not available to the general public - that's why Verizon was invited, to be persuaded to buy EvDO from Qualcomm in the intimate surroundings of the Qualcomm Stadium Super Bowl corporate box in San Diego. But it's hard to sell an illusion.
It's not as though Qualcomm is trying to cheat anybody, though; in fact, throughout Korea and in much of Japan, and in places like Indonesia and Thailand and Vietnam - countries where government has the power to deploy new technology when and where it wants - the EvDO standard is increasingly common. In Korea, it's almost ubiquitous.
In the United States, though, it's years and years away, partly because the intense competition here somehow stymies innovation, according to Clapp, and partly because the big customers - the highly consolidated wireless companies, some of which are going to disappear or be absorbed quite soon, Dr. Jacobs had told us - are fairly close to broke. Qualcomm has $4 billion in cash in the bank, by contrast, Clapp said, and can develop technology all day long, while its customers must dawdle about deploying it.
What are the prospects were for an industry-renewing cell phone craze like the one that has engulfed Japan and Korea, The American Reporter asked. There, using a Qualcomm chip on their cell phone handsets, millions of Japanese teenagers send and receive photos on their cell phones via "sha-mail." a feature first offered by JPhone, the third largest wireless carrier there.
"That will be a very significant part" of the wireless industry's comeback, Jacobs said. But it can't come back until Qualcomm can come across - and no one knows when that might be. As he told one Korean interviewer shortly before "he was drawn away," as p.r aide Ricca Silverio called it, he admitted that that the promises of cell phone providers a few years back to introduce a host of new and easy-to-use features had not been kept. Neither were those of Qualcomm on this Super Bowl Thursday.