Question: where do we fit and why aren't we getting traction here?
On an interesting side note, Burton sees evidence of Qualcomm’s increasing importance in the inclusion of its baseband processor in the Korean version of the S4:
In the near term QCOM’s baseband business took a hit in Q1 from Apple-related weakness, but we are expecting a Q2 pick-up due to its increasing share on Galaxy S4 and at other OEMs. QCOM is operating virtually uncontested in the LTE market right now and our conversations at MWC [Mobile World Congress trade show in February] stressed the importance of Carrier Aggregation (CA) as a ‘must-have’ not ‘just nice to have’ feature for LTE-Advanced (aka Cat. 4 LTE) which will become critical in CY14. While BRCM is said to offer CA in their chip that is sampling (but set to launch in 2014), and MRVL has indicated that they have CA (but outside of BBRY we are less confident in their design wins to date), we note that INTC’s accelerated LTE roadmap does not yet include CA and thus misses the mark. Why? In order to achieve the Cat 4 LTE spec of 150Mbps downlink (up 50% from Cat 3’s 100Mbps) a carrier needs to have 20MHz of contiguous (adjacent) spectrum. For AT&T post the TMO deal denial this is basically mandatory if they want to offer the same capabilities in their top phones vs. Verizon in 2014. Interestingly, we were told that this is also ‘almost required’ for Verizon as well in ’14 (It actually matters a little less anyway if you’re QCOM since they have ~95% or more of the CDMA market). We would also note that investors need only to look to Korea for confidence that CA matters greatly where Samsung is being forced to ship GS4’s with QCOM’s basebands (likely Snapdragon) because some of the Korean SPs are already requiring CA.
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