It’s not the first time that Qualcomm has been the central player in such rumours; one of the longer running stories has been its ‘impending’ acquisition of Xilinx.
Last year, Qualcomm came under pressure from Jana Partners, a New York hedge fund, to create what is called ‘shareholder value’. Jana published a six point plan for the company, which responded with a strategic realignment plan of its own featuring those six points, but in a different order.
After a suitable amount of reflection on the results of a corporate review, Qualcomm’s board said ‘business as usual’.
Known mainly for the semiconductors powering smartphones, tablets and similar devices, Qualcomm has been expanding its reach with some targeted acquisitions – CSR in 2014 being just one. These moves pointed towards ambitions in the IoT market, but Qualcomm has also identified servers as another opportunity.
NXP, should the deal come off, would take the company into another world – addressing some of the concerns related to the prospects for its communications business. The merger between NXP and Freescale created a significant supplier of electronics components into the automotive sector. The two companies also have significant interest in the IoT market.
But it’s the auto market that would likely be the major attraction for Qualcomm. As the car becomes more intelligent, the need for V2X systems grows and it would make sense for a communications company like Qualcomm to get involved. NXP would also take Qualcomm ‘under the hood’ and that might make some other auto electronics suppliers take notice.
Another area of Qualcomm’s ambition – overshadowed by the potential NXP deal – came with the recent announcement that it is to create a global distribution network to make its latest Snapdragon processors available to everyone designing embedded products and to make the devices available for at least 10 years – very different to the smartphone market.
As usual, the observation needs to be made of there being smoke, but no fire. This time, however, there seems to be a lot of smoke.
