Qualcomm, provider of the processors for many notable mobile brands, tablets and smart-devices as well as developer of internet wireless network in Egypt, attended the Information and Communications Technology (ICT) conference to launch their latest project and showcase their support for the Egyptian technology and communication industry.
The Daily News Egypt spoke with Moheb Ramsis Senior Director of Business Development for Qualcomm in North Africa in order to discuss Qualcomm’s latest projects in Egypt, their cooperation with mobile operators as well as plans for investment in the future.
What is the focus of your business globally and in Egypt in particular?
Our strategy in Egypt is focused on a variety of things. Qualcomm in has a major interest in two particular things. One is the processors and this is the main business for Qualcomm. Many of the mobiles today are using Qualcomm chips.
Secondly we focus on licensing, for the 3G and 4G technology. We played a key role in the development of the 3G and 4G networks and as a result earn royalties on these licenses. This is a major revenue stream for Qualcomm.
Egypt specifically is a market that is very price and brand sensitive. At the high-tier of smartphones today, most of the big names are using our chips. These include Samsung, LG, HTC and Song. We are focusing on Smartphones and tablets, which are connected to Egyptian 3G networks. Our strategy has two main focuses. The first strategy is concerned with enabling and empowering more entry level Smartphones, using the 3G network. This is done through the marketing of popular brands to the user. In this effort we are attempting to bring Smartphones to the lowest price possible while maintaining quality.
For example Etisalat recently released a tablet which uses a Qualcomm processor and which draws on a “Qualcomm reference design”. Which is the name of our initiative and it basically concerns selling supplier the chips cells and designs which will save the supplier money, time and resources. Allowing manufacturers to develop design and focus more on user interface and differentiating their technologies. This allows manufacturers to develop products of optimal quality and price.
You mentioned Etisalat; how about Qualcomm’s cooperation with the other mobile operator in Egypt?
We have been working with the three operators on different projects. We are involved with on “network optimisation,” which means optimising their 3G networks in order to offer the best performance possible. Regarding hardware, we have been working with Mobinil for almost a year and a half, to launch Mobinil’s own brand of Smartphones which has been a very successful project. We also worked with Etisalat on a similar allowing them to develop and release their first phone and tablet. We are also working with Vodafone on a marketing strategy for Qualcomm based products.
Does Qualcomm have a production facility in Egypt?
No, we do not.
Is there a plan for building one in the future or in bringing in these kinds of investments?
That is not part of Qualcomm’s overall strategy in Egypt or worldwide. We do not manufacture devices or finished products but we provide support to allow users of our processors and “reference designs” to streamline their production lines. Some production facilities exist in Egypt but they have yet to attain the sophistication to produce devices which can support 3G networks. I believe that such a project will start like any other; first the assembly and then you increase local facilities and then you reach real production and this is something we are hoping to do in 2014.
On both lines of businesses, how much does Qualcomm own or provide in the Egyptian market?
This is a very tricky question because there are no clear numbers that we can say in this case. But say for example, related to the licensing side, 3G in Egypt is at 16%, and is growing fairly well. However, I think that it can grow much more and can have a huge impact on the economy in Egypt. It is not only about more money from licenses, however when you have 3G, there is broadband, and with that much more can be done. For example, when people are given accesses to services via mobile phones, it does not require them to move, saving them time and fuel
So Qualcomm provides 16% of licensing?
On the licensing side, however inside the 16% there is opportunity for Qualcomm on the chipset side; this percentage is not very clear as some brands launch the same device with Qualcomm in some areas and a different chipset in other areas, depending on what they want to offer and what the price target is. Especially because now in many countries 4G is provided, and many of the 4G devices from the same brands (without mentioning names) are launching worldwide with Qualcomm, Snapdragon, and in this region in which 4G is not provided, the brands launch smartphones with a different chipset.
What sort of profits does Qualcomm expect to make in Egypt in 2014?
I don’t really have a number because we don’t look at each country separately. Licensing business is very difficult to track on a country by country basis. What we look at is the key performance indicators (KPI), which is what percentage we are today in 3G penetration and where we will be at the end of the year; we do not calculate revenues on a country basis.
What are some of the new projects Qualcomm has been working on?
We are focusing on the “ecosystem” through commercial and technical sponsorships of our products using our Support Developing Kits (SDKs). One of the latest SDKs in “Vuforia,” technology which enables a feature called Augmented Reality (AR.) For example using a Smartphone with AR when looking at a painting through your phone, the painting, to start to move, talk and explain its history.