Qualcomm for cheaper CDMA

Qualcomm CEO Paul Jacobs today said the company would aim to make CDMA mobile services more affordable in India by encouraging local manufacture of handsets, and not through a reduction in royalty rates.

The Qualcomm brass led by Jacobs today met Union Communications Minister Dayanidhi Maran, and discussed measures to make CDMA mobile services more affordable.

They also discussed the contentious issue of spectrum allocation between CDMA and GSM service providers. Jacobs later described the spectrum allocation discussion as, "not 100 per cent meeting of minds."

Qualcomm's royalty on its proprietary CDMA technology was generally below five per cent, Jacobs said. The price of CDMA handsets had dropped below $40 (about Rs 1,800), and the company's royalty on it came to around $2. Qualcomm's aim was to reduce the handset price to below $30, he added.

The company would find ways to use its proprietary rights over technology and engineering resources, in tandem with handset manufacturers, to improve affordability, Jacobs said.

It had already licensed its technology to a manufacturer in India, and was looking to work with more of them. The key issue with regard to affordability was the handset price, and not royalty, he reiterated.

Royalty was calculated as a percentage of the handset price, and Qualcomm's royalties on CDMA handsets sold in India were the lowest in the world because of low handset prices here, a company executive had earlier communicated to the government.

Jacobs' visit to India was preceded by reports that the country's largest CDMA operator, Reliance Communications, was considering gradual migration to the alternative GSM technology.

At a telecom seminar organised today by the Confederation of Indian Industry, Jacobs said: "I haven't had a chance to talk to Reliance as yet."

Ratan Tata, chairman of the Tata group which owns India's only other CDMA service provider, Tata Teleservices, today met Maran ahead of Jacobs.