Fears over Qualcomm’s first patent deal for WiMax product

Qualcomm Inc. has signed its first licensing agreement for patents it owns covering broadband wireless technology, the company said Thursday in an announcement some WiMax observers have been dreading.

Qualcomm signed the deal, which covers OFDM/OFDMA (Orthogonal Frequency Division Multiplexing/Orthogonal Frequency Division Multiplex Access) technologies, with Soma Networks Inc., a developer of broadband wireless and WiMax equipment. Qualcomm acquired the technology along with Flarion Technologies in an agreement that closed earlier this year. At the time of the acquisition, some vendors began to worry if Qualcomm, known for its vigorous defense of patents covering CDMA (Code Division Multiple Access) technology, had acquired technology crucial to WiMax.

Soma said that the agreement ensures that it has the rights to use Qualcomm’s intellectual property within a new platform introduced by Soma that is based on the mobile WiMax standard.

The announcement is essentially a statement from Qualcomm that it plans to enforce its patents, said Caroline Gabriel, an analyst with Rethink Research. “It did not need to announce this since licensing deals are usually confidential, so I think it’s certainly a public challenge to the WiMax players,” she said.

Alvarion Ltd., one of the largest broadband wireless vendors in the market, has not been contacted by Qualcomm regarding its WiMax products, said Rudy Leser, vice president of strategy and marketing for Alvarion. He said Alvarion has spoken with other industry leaders including Intel Corp. and they believe that Qualcomm’s patents aren’t relevant to the WiMax standards.

He said that Qualcomm may be looking to create a technology, reliant on its patents, that competes with WiMax, much like Qualcomm did when it developed CDMA to compete with GSM (Global System for Mobile).

Qualcomm could not be reached for comment.

WiMax is a standard developed over the past few years that can be used to deliver broadband Internet access wirelessly and has been heavily backed by Intel. The WiMax Forum, an industry group backing the technology, has asked members to disclose any relevant patents they have in an effort to control the patent licensing cost for vendors making WiMax equipment. Qualcomm is not a member of the WiMax Forum.

WiMax vendors and the WiMax Forum have feared that an unexpected license requirement could increase the cost for vendors to build their equipment, a cost that would likely be passed on to end users.

Operators have launched networks based on WiMax in countries including Ireland, France and the U.S. Most of the leading cellular vendors including Nortel Networks Ltd., Telefonaktiebolaget LM Ericsson and Alcatel SA are building WiMax equipment.

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