Qualcomm Inc., a leading wireless IC technology supplier, reported today the resignation of its president and COO, Richard Sulpizio, to "pursue personal interests" and its decision to call off the spinoff of its IC business.
Irwin M. Jacobs, who will retain his position as chairman and chief executive, was tightlipped about the developments. "Last year we viewed the spinoff as necessary, among other things, to minimize potential patent litigation that could arise as a result of Qualcomm selling multi-mode chipsets, including WCDMA and GSM technology," Jacobs said in a company-issued statement.
"Since that time, we have entered into agreements that provide us considerable freedom to support the global expansion of the wireless industry by supplying integrated circuits and software that support one or more modes of CDMA as well as GSM.
"Although we are withdrawing our plan to spin off our semiconductor business, we would reconsider if conflicts arise that adversely affect our ability to operate each business in the best interests of our shareholders."
Announced in July 2000, Qualcomm's spinoff, however, was intended to help the CDMA chipset leader to gain entry into the European GSM market, analysts said at the time the spin-off was announced.
Previously, Qualcomm's customers--handset producers such as Ericsson and Nokia--had impeded its entry into the GSM market because they were only willing to license their technology to Qualcomm in exchange for its CDMA licenses.
Such cross-licensing agreements, however, would have hampered Qualcomm's CDMA royalty business, its core revenue stream, analysts said.
Meanwhile, Qualcomm, San Diego, has held a relatively strong position in the current market climate. Its share prices, for example, have held steady amidst the share price crash suffered by communications IC players across the industry, and unlike many top-tier IC players, it has reported only positive earnings during the last year.