Qualcomm Incorporated is About to Dominate the Next Wireless Standard

Qualcomm's purchase of Wilocity puts the company in a great position for the burgeoning WiGig wireless standard.

Jul 7, 2014 at 12:00PM

Last week, Qualcomm (NASDAQ:QCOM) purchased a small company called Wilocity, which makes an up and coming wireless technology called WiGig. While WiGig has been used in some consumer PCs already, this tech could soon be used to send 4K video from smartphones to televisions and could replace peripheral cords to PCs. Though Qualcomm is stepping ahead of the competition with the latest purchase, Intel (NASDAQ:INTC) is focused on the technology as well.


The WiGig logo. Source: Wi-Fi Alliance.

Why WiGig matters
WiGig works at the 60 GHz level, a higher frequency than Wi-Fi and can send data up to ten times faster, but at shorter distances. So a 4K video could be sent from a smartphone to a TV in the same room, but probably not to a computer in a different room in the house. WiGig can also handle more than one video stream, where Wi-Fi can only use one.

Last year Dell introduced an industry-first with its Latitude wireless docking station, using Wilocity's WiGig technology. Dell used the dock to connect displays, networks, speakers, and other peripherals wirelessly.

According to ZDNet, Wilocity has shipped more than a million of its chips since Dell introduced WiGig into its docking station last year. And Intel has taken notice.

Cutting the cord
Intel has been talking about WiGig for several years and recently set a date for complete wireless computing -- including charging and no cords for peripherals -- for all its Intel PCs by 2016, at the earliest. But while Qualcomm purchased the WiGig tech, Intel wants to build its own. The company plans to bring its latest reference design for WiGig to market early next year.

Qualcomm has the advantage because it's been working with Wilocity on wireless tech for several years, and bringing the company in house should be a seamless transition. Aside from that, the fact that Wilocity's chips are already leading the WiGig market should give Qualcomm a lead over Intel's in-house development.

Foolish takeaway
Though a lot of talk about WiGig surrounds PCs, there's huge potential for this in the mobile space, which is why Intel and Qualcomm are pushing into it. Tablets and smartphones could communicate quickly and more efficiently with home automation systems, televisions, and each other.

The WiGig Alliance is expected to establish formal standards for the technology early next year, which should help push it further into devices.

Qualcomm's Snapdragon 810 processor is expected to ship with WiGig early next year, which will beat Intel's timelines. Qualcomm is a leader in mobile connectivity, while Intel is still playing a huge game of catch-up. In 2013, Qualcomm took an amazing 99% of the integrated baseband smartphone processor market and 64% of the mobile chip revenue, according to Bloomberg. Purchasing Wilocity ensures that Qualcomm once again beats the competition to the next wireless standard, leaving Intel to spend plenty of time and resources building its own WiGig technology.

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Chris Neiger has no position in any stocks mentioned. The Motley Fool recommends Apple and Intel. The Motley Fool owns shares of Apple, Intel, and Qualcomm. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

4 in 5 Americans Are Ignoring Buffett's Warning

Don't be one of them.

Jun 12, 2015 at 5:01PM

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David Hanson owns shares of Berkshire Hathaway and American Express. The Motley Fool recommends and owns shares of Berkshire Hathaway, Google, and Coca-Cola.We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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