Tomahawk, WI 04/10/2014 (Basicsmedia) – QUALCOMM, Inc. (NASDAQ:QCOM) pioneered CDMA technology and since then it has been a major player in establishing subsequent generations of cellular communication standards such as CDMA2000, WCDMA and 4G LTE.

64-Bit Smartphone Processors

Qualcomm dominates the ‘System on a Chip’ market with its Snapdragon platform that is used by major cellphone manufacturers except Apple Inc. (NASDAQ:AAPL) which uses its internally-developed A7 processors in its iPhones.

It has unveiled its latest range of smartphone processors that feature 64-bit processing and LTE technology — Snapdragon 808 and Snapdragon 810. This is to ensure that Qualcomm remains the leader in designing smartphone processors — just as Intel Corporation (NASDAQ:INTC) is the leading maker of microprocessors for PCs and laptops — and will help it ward off competition from Intel and others like NVIDIA Corporation (NASDAQ:NVDA).

Apple became the pioneer as it introduced the first 64-bit chip processor for smartphones in its iPhone 5s. Smartphones need at least 4GB of RAM to take full advantage of these advanced 64-bit processors. Also, you need operating system (iOS for Apple devices and Android for non-Apple smartphones) code and application that is written for 64-bit processors.

The Snapdragon 808 comes with six cores and Adreno 418 graphics processing unit (GPU) and will support 2K screens while the top end Snapdragon 810 with eight cores and an Adreno 430 GPU will support 4K resolution screens. While all this performance comes at the cost of increased power consumption and takes a toll on smartphone batteries, the 808 and 810 processors use 20-nm manufacturing which will lessen the power consumption somewhat.

The Danger of Losing Apple

Qualcomm supplies the key baseband processors to Apple that are used in its iPhones and iPads. And considering each iPhone probably includes about $40 worth of baseband and power management components from Qualcomm and upwards of 150 million iPhones got shipped by Apple in 2013, Qualcomm probably earns revenues of $6 billion from Apple. Hence, if Apple develops its own baseband processors — which is what is happening as per rumors — QUALCOMM, Inc. (NASDAQ:QCOM) faces a multi-billion dollar hole in revenues and net income. Hopefully, with its massive $14 billion R&D expenditure over the last four years, Qualcomm will be able to ward off competition in the LTE baseband market from the likes of Intel.

Wearable Devices and Internet of Things

The next frontier for chip makers lies in wearable devices and the coming Internet of Things. Samsung and QUALCOMM, Inc. (NASDAQ:QCOM) have provided $17 million in Series B funding for Silicon Valley-based hardware startup Ineda Systems that develops chips for wearable devices and embedded Internet of Things systems.

DISCLAIMER: This content is neither an offer nor recommendation to buy or sell any security. We hold no investment licenses and are thus neither licensed nor qualified to provide investment advice. The content in this report or email is not provided to any individual with a view toward their individual circumstances. While all information is believed to be reliable, it is not guaranteed by us to be accurate. Individuals should assume that all information contained in our newsletter is not trustworthy unless verified by their own independent research. Also, because events and circumstances frequently do not occur as expected, there will likely be differences between the any predictions and actual results. Always consult a real licensed investment professional before making any investment decision. Be extremely careful, investing in securities carries a high degree of risk; you may likely lose some or all of the investment.