Wednesday, August 10, 2005

QUALCOMM to Acquire Flarion for OFDMA Technology

QUALCOMM will acquire will acquire Flarion Technologies, a pioneer of Orthogonal Frequency Division Multiplex Access (OFDMA) mobile broadband technology, for $600 million in stock and cash.

Flarion, a start-up based in Bedminster, New Jersey, developed a fast, low latency air interface technology that combines attributes of TDMA and CDMA. Flarion's flash-OFDM mobile broadband system is a packet-switched radio access network with QoS capabilities that overlays onto a mobile operator's existing cell sites and spectrum. Flarion's platform provides a seamless routing interface to the operator's existing IP network. The company is now shipping its second-generation FLASH-OFDM modems and chipsets support typical downlink speeds of 1 Mbps and peak user burst rates of 3 Mbps (Downlink Modulation: 16 QAM, QPSK) using 1.25 MHz FDD spectrum, and typical uplink speeds of 300 to 500 Kbps and peak user burst rates of 900 Kbps (Uplink Modulation: QPSK).

Earlier this year, Flarion unveiled its "Flexband" architecture for on-demand video, voice and data services for mobile operators with either 1.25MHz or 5MHz licensed spectrum. Flexband leverages Flarion's BeaconTone technology, which maximizing data capacity and throughput for each individual subscriber. BeaconTone technology enables subscriber devices to continuously monitor in-band interference and instantaneously select the most optimal carrier to deliver maximum bandwidth and performance. At the time, Flarion said a fully supported 5MHz multi-carrier system voice calls increase to 186 per sector and data rates increase to 15.9Mbps peak and 6Mbps sustainable. Flexband would be able to support over 600 subscribers consuming 1GByte of data per month, according to the company.

QUALCOMM said it will continue to focus on raising throughput and lowering cost of 3G CDMA networks with advances in receive diversity, interference cancellation, multi-carrier and speech compression.

The company expects the introduction of VoIP on data-optimized RF carriers and the integration of wireless LAN and multicast technologies, such as OFDM-based FLO (Forward Link Only) technology, to provide increased opportunities for operators using various frequency bands and the air interface technologies best suited to the service offering.

"With this acquisition, QUALCOMM will be in a stronger position to support advanced development in both CDMA and OFDMA technologies," said Dr. Paul E. Jacobs, CEO of QUALCOMM.

QUALCOMM estimates that it will issue stock with a value of approximately $267 million, assume existing Flarion options and warrants with a fair value of approximately $128 million, and pay approximately $205 million in cash, net of Flarion's projected cash balance.

  • Flarion Technologies was founded in 2000 by Dr. Rajiv Laroia, who previously was with Bell Laboratories. In 1997, he became head of Bell Labs' Digital Communications Research Department in the Wireless Research Center where he and his team started to develop FLASH-OFDM technology based wireless data system.

  • In October 2004, Siemens Communications has agreed to integrate Flarion Technologies' FLASH-OFDM technology into its portfolio of mobile broadband solutions. The companies have also signed a memorandum of understanding under which Flarion will develop basic 450 MHz-band equipment according to Siemens specifications. The companies noted that the 450 MHz frequency band in many countries had been occupied by analog mobile telephony, and is now available due to the migration to digital mobile networks. In particular, mobile operators in Eastern Europe who do not hold UMTS licenses are looking for an affordable mobile broadband solution for the 450 MHz band.

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