Qualcomm CEO Still Unsure about Nokia/Sanyo CDMA Venture

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Qualcomm CEO Still Unsure about Nokia/Sanyo CDMA Venture

7:30 am on March 1, 2006 | Category: Business, Mobile Devices

Qualcomm CEO, Paul Jacobs said on Monday that he plans to take a casual, wait-and-see approach to the recently announced joint venture between Nokia and Sanyo, and what it might mean for his company.

The two handset makers revealed last month that they plan to work together on new cell phones using the CDMA wireless standard, which is dominant in the United States, as well as some parts of Asia and Latin America.

When this partnership was first made public, it looked like a very positive sign for Qualcomm, which is the world’s leading provider of CDMA chips, and holds many patents relating to the technology. But despite the fact that the company’s stock jumped 3.6% on word of the joint venture, Jacobs still isn’t convinced that the news is all good.

“The jury is still out,” said the Qualcomm CEO. “There have been people who have come to me and (said) this (joint venture) signals that Nokia is getting out of the business. Rather than listen to what everyone is saying, we’re going to see how people are going to act.”

The world’s biggest handset maker has floundered in the CDMA market for the past few years, especially in the United States, and the deal with Sanyo could either be a move by Nokia to strengthen its position, or to pass its interests in the technology off to someone else.

Although the short term implications of such a deal are probably good for Qualcomm, there are no guarantees that Nokia will keep making CDMA phones. And if the handset giant gives up on CDMA, it will likely spell hard times for Qualcomm and many others.