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Qualcomm Buys Airgo, RFMD Assets

Dan Jones
LR Mobile News Analysis
Dan Jones, Mobile Editor
12/4/2006
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Qualcomm Inc. (Nasdaq: QCOM) says that it will buy Airgo Networks Inc. -- as well as the Bluetooth assets of RF Micro Devices Inc. (Nasdaq: RFMD) -- in a move that instantly gives the company, which helped pioneer the CDMA networking protocol, a major presence in the market for the newest WiFi technology.

Qualcomm hasn't revealed how much it will pay for Airgo. The startup first introduced WiFi chipsets based on MIMO (multiple input, multiple output) antenna technology, which is the basis of 802.11n WLAN, in 2003. MIMO "smart antenna" technology uses multiple antennas on the client device and -- often -- the access point to increase the speed and capacity of an 802.11 wireless link to over 108 Mbit/s. (See Airgoooooooooooo! .)

Airgo has been an early leader in this market. Initial sales in the so-called "pre-802.11n" have generally been in the consumer market with SOHO routers and WLAN cards being top sellers. (See Airgo Hits Million Mark and Enterprise WLAN Market Up 19%.) Qualcomm says it will continue to support these products and also bring the technology into its newer mobile silicon, such as its recently announced "Snapdragon" wireless multimedia chipsets (See Powering Up 3G.)

Additionally, Airgo has taken an active role in the long-running efforts to deliver an Institute of Electrical and Electronics Engineers Inc. (IEEE) 802.11n specification, an effort dogged by infighting between the multiple vendors involved. Qualcomm is also involved with the 802.11n spec work, so it's unclear if this acquisition will speed up the ratification. (See Dot-N Delayed Again.)

The Wi-Fi Alliance recently stepped in to foster interoperability between "pre-n" WLAN products and alleviate the early problems. Airgo and Qualcomm have used the Wi-Fi Alliance's interoperability specification to introduce an 802.11 "draft 2.0-compliant" chipset. The AGN400 chipset is currently sampling and will be publicly demonstrated in January 2007 at the Consumer Electronics Show in Las Vegas and be commercially available shortly thereafter. (See WiFi's High-Speed Compromise.)

Meanwhile, Qualcomm has acquired the Bluetooth assets of RFMD for $39 million. The buyout will give Qualcomm the technology to integrate Bluetooth into its own chipsets. The firm has previously worked with Broadcom Corp. (Nasdaq: BRCM) and Ericsson AB (Nasdaq: ERIC) on Bluetooth.

Both of these acquisitions give Qualcomm extra wireless technologies under one roof and should allow it to build more connectivity options into a single chip. Integration has become more important in the mobile chipset market as smartphones and other devices become increasingly powerful.

The Airgo acquisition is expected to close by January 2007.

— Dan Jones, Site Editor, Unstrung

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