Apple Shouldn't Worry About Qualcomm's Beacon Tech

In the midst of all the hype around Apple's (NASDAQ: AAPL  ) iBeacon microlocation technology, Qualcomm (NASDAQ: QCOM  ) is poised to jump into the game with its own Gimbal beacon system. But despite the two companies launching separate systems, Qualcomm could actually give Apple's beacon pursuits a big boost.


Gimbal website screenshot. Source: Qualcomm.

Bluetooth beacon implementation
Just to bring everyone up to speed: Beacon technology like Apple's iBeacon and Qualcomm's Gimbal is a way for businesses to use location-based messaging to interact with customers and mobile users. Beacons use Bluetooth Low Energy, or BLE, to send and receive signals from mobile devices. Users can opt-in to receive the information; both Apple and Qualcomm's beacons currently only work with iOS devices, but the tech will work on Android devices in the future as well.

Major League Baseball is implementing Apple's iBeacon technology at some stadiums next season to guide ticket holders to their seats via their iPhones, offer discounts when they walk into stadium merchandise stores, or even call up their tickets as they approach the stadium. Apple just launched the tech in its own stores to show customers information about devices they're looking at and to let them know if they're eligible for an iPhone upgrade.

More opportunity than competition
Qualcomm's Gimbal works much like Apple's tech, with low-powered Bluetooth Smart beacons sending out information to iPhones. Qualcomm is selling its beacons for geofencing, proximity awareness, and interest-sensing uses. All of that jargon simply means the beacons can locate where users are to give them directions to a certain part of the store, know when they've entered or left specific sections of a store or location, and also provide offers or information based on users' preferences.

Though Qualcomm is obviously looking to sell Gimbal technology to companies, it's not necessarily a threat to Apple's iBeacon. While Apple could be positioning itself to launch a mobile payment system through its technology, the main focus for now is to make its iPhones even more valuable and functional for customers. Apple stays ahead in the mobile game by adding value to its devices and making it easy for retailers and other companies to make more use of Apple devices. So if Qualcomm sells a lot of Gimbal beacon devices that interact with iPhones, that's essentially still a win for Apple. iPhone users won't be able to distinguish whether the messages are coming from Gimbal or iBeacon, they'll just receive the information to their phones. 

Though Qualcomm is releasing a software development kit for both iOS and Android, the beacons will only work on iOS devices right now, with Android support coming soon. Qualcomm's system in effect gives Apple yet another advantage because it's the only device maker that can run Gimbal for the moment. 

So Apple investors who are excited about the possibilities of iBeacon shouldn't see Gimbal as a direct threat. If Qualcomm sells a massive amount of beacons and hundreds of retailers use them in their stores, iPhone users are the direct beneficiaries right now -- which is exactly what Apple wants.

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