Qualcomm intends to purchase Flarion Technologies, according to Qualcomm's press release today. It will be interesting to see what Qualcomm does with Flarion's high speed wireless data technology.
Flarion, as many of you known, has been a pioneer in developing Orthogonal Frequency Division Multiplex Access (OFDMA) technology and is the developer of its FLASH-OFDM technology for wireless data services.
Qualcomm's release says the company will pay about $600 million for Flarion "net of Flarion's projected cash at closing, in Qualcomm stock and cash, including the assumption of options and warrants at fair value. Upon the satisfaction of certain milestones over the next few years, Qualcomm may also pay an additional $205 million in the form of cash and Qualcomm stock."
Offering a choice
Dr. Paul Jacobs, the CEO of Qualcomm, says in the release, "With this acquisition, Qualcomm will be in a stronger position to support advanced development in both CDMA and OFDMA technologies. The combination of Flarion and Qualcomm engineering resources greatly strengthens our position as a continued technology innovator and leader in the wireless industry.
"We believe CDMA will provide the most advanced, spectrally efficient wide area wireless networks for the foreseeable future, but with Flarion we can now more effectively support operators who prefer an OFDMA or hybrid OFDM/CDMA track for differentiating their services.”
Why buy Flarion?
Flarion has had a pretty tough time trying to get into the mainstream with its technology and it hasn't, unfortunately, succeeded. It's very, very difficult to buck the standards of GSM and CDMA, no matter how well integrated a new technology could be.
But many operators are looking at ways to provide much higher data rates for wireless data applications and are willing to at least test new technologies. Overseas, cellular operators and wireless entrepreneurs in certain countries might be more open to using OFDMA either as a differentiating technology in a startup venture or in conjunction with CDMA or GSM.
Purchasing Flarion gives Qualcomm access to another high speed wireless data technology -- that typically has been well reviewed in testing -- and offers Qualcomm opportunities for making new sales.
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