No longer content to add computing features like e-mail and Web browsing onto cell phones, Qualcomm is pushing its phone processors into PC territories such as desktop computers, video game consoles and lightweight alternatives to laptops known as netbooks.
At a meeting with analysts last week in New York, the San Diego company showed off its prototype Kayak “PC alternative” and Zeebo game console, both intended for emerging markets. Qualcomm also said it has doubled the speed of its Snapdragon chip that powers netbooks and portable Internet devices. Fifteen manufacturers are poised to begin making Snapdragon devices.
All of the devices are made possible by the growing power of mobile phone processors. The upgraded Snapdragon chip runs at 1.5 gigahertz, a processing power equivalent to Intel’s Pentium 4 when it was released in November 2000.
While all of the new products have been in development for years, the timing of their release may work out well for Qualcomm.
“Plowing new ground is good thinking in these market conditions,” said Will Strauss, president of digital market research firm Forward Concepts.
Strauss said the three new product lines are interesting but said their success will depend largely on whether they are affordable – particularly when marketed in developing economies.
Although Qualcomm designed the technologies, it will encourage other companies to manufacture the products.
In the Kayak prototype, Qualcomm has designed a device capable of bringing the Internet over cell phone data networks to areas that may lack wired Internet service from cable and telephone providers.
“Imagine a very small box that can connect to a home TV or monitor and serve as an alternative to the PC in emerging geographies,” said Luis Pineda, senior vice president of marketing and product management for Qualcomm’s chip making division. “These areas have low PC penetration – in some cases as low as 1 percent – and low fixed (wired) broadband.”
Pineda said Kayak has received an enthusiastic response from foreign cell phone providers. Consumer field tests are planned in Southeast Asia during the first quarter of 2009 using prototypes manufactured by Taiwan computer company Inventec.
Pineda said the Kayak home computers could sell for $200 to $300, or less if carriers offer subsidies.
The prototype Kayak system does not contain a hard drive. It is designed to access software online for word processing and other functions through an Opera Software browser. It includes two USB ports for keyboard and mouse connections.
The prototypes will be able to function when the computer is taken offline – running programs, video games and playing music using software and content loaded from USB devices or memory cards, Pineda said.
Qualcomm set video game bloggers buzzing last week with the announcement that Brazilian company Tectoy would launch a game console called Zeebo. The device is designed to bring gaming to emerging markets where piracy is often a problem. Zeebo is expected to cost about $260.
Unlike games for systems from Microsoft, Sony and Nintendo, which come on discs, Zeebo games will be downloaded to the console. By storing the games on the network, piracy will be controlled and a new market will open to video games, Qualcomm Chief Executive Paul Jacobs said.
Zeebo will use a business model similar to Amazon’s Kindle e-book reader, which includes a built-in high-speed wireless connection without a subscription, Jacobs said. The price of the wireless service is built into the fee for the content.
Qualcomm said devices running on the long-awaited Snapdragon chips should show up early next year. The expected gadgets include portable Internet devices with larger screens than today’s smart phones as well as netbooks – lightweight devices with screens similar to laptops featuring always-on connections to the Internet via cell phone networks.
Strauss, the market researcher, said the Snapdragon devices could open opportunities for Qualcomm. The biggest question is whether they will be priced competitively.
“The netbooks might have legs,” Strauss said. “But it’s going to have to have a price of $300 or less.”
Similarly, a Kayak desktop device faces a market of low-end PCs that include monitors for not much more than $300, Strauss said. And the market for expensive video game systems could be limited in developing countries.
“You’re not going to sell $300 game consoles in the Third World,” he said. Jonathan Sidener: (619) 293-1239; jonathan.sidener@uniontrib.com