Qualcomm and Rakuten Collaboration

The Six Five team talks the collaboration between Qualcomm and Rakuten Symphony.

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Transcript:

Patrick Moorhead: So Daniel, let’s move to the next topic, very similar to what we were talking about trends at Mobile World Congress. And essentially this is a Qualcomm and Rakuten partnering on massive MIMO, but what’s going on there?

Daniel Newman: Pat, you indicated that we’ll be hearing quite a bit about open RAN, and right now, what we’re looking at are where are these kind of partnerships on a global scale? You’ve got companies building technologies, you’ve got companies deploying technologies. And Rakuten announced a partnership…I Actually had a chance to do a podcast with the CEO of both Rakuten Symphony and Durga Malladi from Qualcomm, that leads that business.

And I mean, basically, it’s a 5G ran platform. It’s going to be designed and deployed by Rakuten. And they basically have picked Qualcomm to commercialize their massive MIMO, RUDU, and it’s going to be what they’re going to offer for their next generation 5G infrastructure. So what we’re really dealing with now, Pat, is that you mentioned, open and virtual RAN is where they’re going.

The deployments of these moving from old architectures to cloud native architectures is the key. They want to be able to add automation. They want to be able to be more efficient. They want to be able to keep uptime levels high, and then of course they want to be cost effective. So this partnership, as they saw it, was going to give them the greatest opportunity to be successful.

Of course, this adds to the diversification play of Qualcomm, because so many people think of Qualcomm as the devices and handset side, but this is heavy on the infrastructure side. This where they’re partnering up with companies. And by the way, Rakuten, Pat, I don’t know if you remember around 2019 or ’20, they had to have been the star of Mobile World Congress. I felt like every single booth I went to, I was seeing what Rakuten was doing with Cisco, what Rakuten was doing with Qualcomm, what Rakuten was doing with… I think I saw nine demos, in what must have been ’19 the last time we were there.

But anyways, I digress. Fact of the matter is, now, as I mentioned, and you mentioned too, we’re seeing, A, the year of 5G. And this is part of what’s making it real. It’s not just about having devices. It’s about having the infrastructure that provides the bandwidth, the capacity, the scale, and by the way, the speed and efficiency that these carriers need. So Rakuten’s been consistently flexing its muscle, especially overseas. I like them kind of like, I like T-Mobile here in the US, in terms of innovation. And it was a robust, solid partnership. I think this is one that we probably don’t need to spend 20 minutes talking about, but big win and obviously timely that they announced it coming right into MWC.

Patrick Moorhead: It’s funny a couple years back, I used to, I wouldn’t say make fun of Rakuten, but it was like everybody was partnering with Rakuten, everybody in the industry. Whether it was Intel Qualcomm, Marvell, it was like, everybody was partnering with them. But in reality, they really, are all kidding aside, they are really the poster child for the next generation of a carrier, where it’s all virtualized, there’s no cruff, meaning there’s no old legacy stuff that they have to take care of or they need to capitalize. This is a brand new, new infrastructure.

And like you said, most people look at Qualcomm, that their strengths, which is on the modem side, but they really have a growth play going, and one of those is infrastructure. If you study the history of Qualcomm, Qualcomm used to have infrastructure. They had infrastructure and then they had phones. So it was kind of ironic that they’re getting back into the business. And nobody should think that they’re brand new at this, they’re not, they’re just getting back into it. And-

Daniel Newman: That’s such a good point though, Pat, not to cut you, I was trying to say, and I think you just hit it in a few words, is that people don’t credit… As we’ve talked about Qualcomm’s diversification path, this is like one of those really good examples of how they’re going to play in 5G well beyond what they’re best known for.

Patrick Moorhead: You’re right. We don’t have to spend 20 minutes on this. This is very straightforward, but it’s a positive sign for Qualcomm to see some success. Because quite frankly, you can’t put a price on something, even if you give away something for free, somebody’s not going to take it unless it’s really awesome. And looks like Qualcomm is making it happen, in yet another one of their growth businesses.