Ex Qualcomm Exec that helped develop CDMA now working on 4G

[Fire14]

Spectrum Fight Over, On To 4G

Stay tuned for Allen Salmasi's next act in wireless.


A top executive at cell phone pioneer Qualcomm QCOM 20 years ago, Salmasi helped develop CDMA (or code-division multiple access) network technology. Now it's used around the world for wireless voice and data services.

In 1995, Salmasi founded NextWave Telecom. It acquired spectrum for mobile services in a federal auction, then went bankrupt. Salmasi waged a five-year legal battle against the Federal Communications Commission to keep NextWave's wireless licenses.

He won the case, which reached the U.S. Supreme Court. Then he sold off spectrum to Verizon Wireless and Cingular.

But Salmasi kept some spectrum. Borrowing the name of him old company, he formed a new venture called NextWave Wireless WAVE. It's aiming to be a player in wireless broadband, also called 4G, or fourth-generation technology.

NextWave went public in November, and in April it acquired another 4G startup, IP Wireless, for about $100 million in cash and stock.

After jumping more than 30% early this year, NextWave now trades near 9.50. The company raised $355 million in a private placement in March, $50 million of that from Salmasi's own pockets.

Salmasi recently spoke to IBD about his plans for the money.

IBD: NextWave is developing chips and network products as well as acquiring intellectual property. Some observers say that strategy is similar to Qualcomm's.

Salmasi: There are some similarities but also some major differences. We are completely focused on 4G (wireless broadband) technologies. Qualcomm is focused mainly on CDMA. There are different road maps for the evolution of existing wireless networks. Our goal is to support all the different road maps and ultimately evolve 4G technologies into one platform.

IBD: Some say NextWave is developing a proprietary version of mobile WiMax, a wireless broadband technology, that it would seek to license.

Salmasi: That's not the case. We are developing a standards-based technology. We have continued to develop enhancements for WiMax. And we have submitted those into the standards process. That may come across as being a proprietary shop, but that's not the case.

IBD: Are your potential customers incumbent wireless service providers or new entrants?

Salmasi: Both. But our view is that existing carriers would benefit more from the work we are doing than emerging carriers.

IBD: Qualcomm acquired a 4G startup called Flarion. Qualcomm has its own 4G intellectual property and road map. Is it a rival?

Salmasi: Not really. We will support Qualcomm in any of its development activities or sales to carriers in any way we can complement them. It may be that certain products we are developing may overlap with Qualcomm. They certainly have the choice of offering their own solution or taking parts of our solution and combining it with theirs for enhanced capabilities.

IBD: Do you and your family still hold a sizable stake in Qualcomm?

Salmasi: I'm still a Qualcomm shareholder. We did own a fairly sizable stake. I have a diverse portfolio. My personal fortunes aren't tied to Qualcomm's future.

IBD: NextWave acquired PacketVideo, a mobile video startup. Your more recent purchase, IP Wireless, also has mobile TV technology. Is that a primary focus?

Salmasi: Mobile TV and streaming video is a big part of our strategy. We believe multimedia applications (and convergence) are going to drive demand for 4G networks. Those are applications that require more bandwidth, more spectrum, and technologies that support high-quality connections. We have a very strong intellectual property position in that area.

IBD: Some analysts say that demand for wireless data services via existing 3G networks has been disappointing. Is talk about 4G overly optimistic?

Salmasi: I don't agree with that assertion. The trends are indicating that even on 3G wireless networks with limited capacity and limited multimedia capabilities, (carriers) are experiencing rapid growth in multimedia downloads.

IBD: Sprint Nextel S is deploying a WiMax network. Will it have an edge if a 4G market develops?

Salmasi: For any new technology to mature in the marketplace, to become real commercial services, usually takes a minimum of five to seven years. The real advantage that Sprint and Clearwire CLWR will have is that they can potentially prove out the technology ahead of some other carriers. That learning experience is invaluable.

IBD: Why did NextWave acquire IP Wireless?

Salmasi: It developed one of the first 4G technologies. They really have the most solid technology that has been developed to date, with high-speed connection rates. Last year they won a public safety (network) contract in New York City.

IBD: Why did Sprint pass on using IP Wireless' 4G technology?

Salmasi: You could talk to (Sprint chief technology officer) Barry West. He would tell you that they went with WiMax because it was closer to being commercialized.

IP Wireless didn't have an ecosystem around (its) technology at the time.

IBD: Qualcomm always seems eager to acquire intellectual property. Why didn't it buy IP Wireless?

Salmasi: I'm not sure it would have been a good complement to Qualcomm. It also comes down to chemistry between the shareholders and management teams. That was probably one of the reasons IP Wireless went with NextWave.

Source: Investor's Business Daily

www.cellular-news.com/story/23712.php

[hillbilly44]

With Allen Salmasi's track record I wouldn't put alot of stock into anything he state's. Remember, Nextwave was the comapny that bought spectrum licenses several years ago and then promptly filed bankruptcy. Nextwave never buit a network, they turned around and sold their licenses to other carriers. It was one of the biggest fiascos that came out of the PCS auctions.