UPDATE: Deutsche Bank Raises PT on Broadcom Following Analyst Meeting
by Dwight Einhorn13 hours ago
In a report published Wednesday, Deutsche Bank analyst Ross Seymore reiterated a Buy rating on Broadcom Corporation (NASDAQ: BRCM), and raised the price target from $31.00 to $34.00.
In the report, Deutsche Bank noted, “BRCM's analyst meeting focused on the co's strategy to take its successful platform-driven approach in Broadband/Networking and apply it to Mobile. We are encouraged with the co's LTE initial traction (showed Samsung LTE design win; pulled roadmap ahead by a qtr), but continue to believe ‘hero-phone' wins will eventually be necessary to economically justify the high level of investment. Overall, we continue to view BRCM as undervalued given its solid core biz and the optionality in Mobile. Maintain Buy.”
Broadcom Corporation closed on Tuesday at $28.51.
So back to platform control. Platform control is very important. Our customers want us to deliver a complete platform to the marketplace. And great mobile and wireless technology allows us to complete many different platforms, and I'm just citing a few here, starting with the Hand set-top box or cable modem or DSL gateways, okay. The IP that he needs are -- is LTE, WiFi, Bluetooth and NFC, all technology that allows us to complete the set-top platform.
Moving to IoT and wearables. Great WiFi, Bluetooth, NFC, GPS and touch are all needed to complete that platform. Let me just make a reference that just yesterday, we announced the latest generation of our GPS technology that can receive signals from 5 different satellite constellations, 88 different satellites in all, and provide the best positioning solution to all of the apps that we all use every day that rely on position to give you the best information. That's the kind of IP that's necessary to make a success in the IoTs and the wearables.
So in summary, we have made a lot of progress on our complete platform solutions with the addition of our 4G LTE IP and the acquisition we completed 71 days ago. Our customer relationships are strong. We services about every leading handset company with our connectivity solutions, and we have more and more engagements on our cellular platform, okay.
And now, what I'd like to do is to talk about one more thing, okay. Scott mentioned some very aggressive goals for us to achieve in 2014. And I'm very happy to announce, because of our intense focus on execution, our first LTE phone from the world's largest smartphone manufacturer, Samsung, I'm holding it in my hand, and there's a picture of it on the screen, okay. This is a phone that's based on Broadcom's M320 or the EOS2 platform that was referred to previously, Category 4 with a global launch coming in early 2014. So this phone will go to production in early Q1 2014, based on Broadcom's LTE solutions. So again, pulling in th
And then finally, graphics. Again a 5 to 10x improvement in our graphics performance, support of the latest graphics libraries, like OpenGL ES [ph] and GP GPU, okay? We're going to maintain our advantage in graphics, where we're smaller sized and lower power. So we're going to pay attention to all of this IP. When you consider this kind of IP added to the new modem IP we have, this will be a very exciting set of cellular SoCs that will emerge in 2014.
3x the performance to improve the quality of the images that you take because everybody wants a good camera in their smartphone.
We're going to improve the speed of the pixel processing, and we're going to make sure we have these advanced features, things like signal, smart imaging for things like beautification [ph] and augmented-reality apps, okay? So our imagining IP is going to improve significantly. Now keep in mind that Broadcom's ISP technology was in the first Nokia 42-megapixel phone, and Broadcom's ISP technology was the first ISP to make it through the Samsung image labs in 2013 -- in 2012, okay? So our ISP is only going to get better from here.
And then on video, of course, strength of Broadcom. Obviously, video permeates every part of the company, 2x to 4x improvement. We're going to be able to support UltraHD configurations, increased frame rates to 120 frames per second in certain configurations and implement more efficient codecs like the H.265 codec, which is 2x the efficiency -- I'm sorry, about 50% the efficiency of the prior version, which is H.264 [ph], so better video compression, okay? So our video IP is going to improve.
And we're spending a lot of time and paying a lot of attention to CPU and graphics in this new SoCs that are going to tape out in 2014. We're going to do SoCs with more application processors. We're not going to say how many more, but certainly more than 4. And we're going to increase the performance by 3x. Where Rajiv can put 20 cores [ph] on a chip in the mobile and wireless space, we need to have a very careful tradeoff of power and performance, and we're going to do the right thing here. But I do want to make mention that Broadcom is an early access partner to ARM for their 64-bit class of processor and their V8 [ph] instruction set. So we announced that over a year ago, and that process -- that new processor will be a part of our new roadmap in 2014.
Now let me continue because, last year, we talked about a Fin [ph] modem. This year, we're going to embellish that Fin [ph] modem with more features and sample it in mid-2014. Category 6 LTE, which is now 300 megabits per second, this will include carrier aggregation for the carriers that don't have contiguous spectrum. This will be our first chip with TD-SCDMA for China Mobile. So we've been working on TD-SCDMA now for a number of years, and that technology will port over to the new modem architecture. All of these chips are complemented by Broadcom's RF subsystem, which can do quad-band 2G, peta-band 3G and as many bands on LTE as you could want, okay? Voice over LTE, LTE broadcast, advanced transmit technology like Envelope Tracking, okay?
So you might ask, what makes you -- why should you believe that Broadcom could deliver a chip like this. Here is the reason. The modem team that we acquired was working on this technology when we acquired them. The modem architecture is very modular. Unlike some of the new implementations on LTE, the way our team architected this thing is in a very modular fashion, so the 4G category 4 will [ph] not need to be changed in order to put Cat6 [ph] on top of it. And we've already taped [ph] out a chip with a significant amount of this category 6 IP. We think this chip is going to compare very well with anybody else's modem out there in 2014. So that product will be available and sampling in mid-2014.
And then, of course, there's going to be more chips that are coming. I talked to you about the SoC roadmap, which really will hit the sweet spot of the LTE marketplace, phones from $100 to $300, different screen sizes, different IDs. And there's another series of cellular SoCs coming. And Scott mentioned the tape-out of these chips are things we're measuring very closely. The team is very focused on execution. So within these new series of SoCs, we're going to improve the ISP, the image signal processing IP, 3x the performance to impr
places in China, Europe and of course, Nokia, okay? So this modem IP is -- has a long legacy of history, and the team really knows what they're doing. I'm very happy to report that integration is going very well. The team is very motivated to make sure that this thing is a success. In fact, the team thinks that this is the best partnership for them. Our connectivity and their modem technology is going to be a very formidable force in the marketplace.
Now complement that with all these quantitative things we just talked about, ready today with VoLTE, ready today with carrier qual. We've already got carrier qual on many of the most difficult networks like AT&T, like NTT docomo, like SoftBank in Japan and a lot places in Europe, including Vodafone and Orange and EE, okay? The 2 most prevalent types of LTE supported with this chip at Cat4 rates complemented with our complete platform. So these are the reasons that our customers are very happy with us right now because they really like what we've done with this 4G LTE story.
reuse on both the hardware and the software platform. We've done it for 3G already, with 4 different turnkey designs that you can see proliferated to over 100 handsets now in places like China, and we'll do it for the 4G family of products you just saw, okay? So the turnkey -- fifth-generation turnkey. We've learned a lot about the first 4 turnkeys we've produced for all of our 3G designs. We've optimized it. We've optimized the cost. We've optimized the design, and now we're going to apply all that knowledge to our 4G turnkey.
Okay. So let me go and talk about why would customers pick us for LTE, okay? Well, we have a compelling roadmap. We just showed you that. We have a turnkey that's ready to go. But let's talk about again some of those quantitative advantages that we have over the competition. So our power consumption is 20% to 30% lower than our competition, and our die size is more efficient. It's smaller than our competition by 25% to 30%. Again, you might ask, "How could Broadcom make such a bold claim in terms of both power consumption and die size?" In order to substantiate this, you need to look at the legacy of the modem team we just acquired.
The modem team we just acquired is the Nokia modem team located in Europe and in Finland, and they've been working on modem technology for 15 years. In fact, they've sold billions of 2G and 3G modems. They were there when the 4G LTE standard was created. They were probably 1 of 2 semiconductor companies at the table when the LTE standard was defined in 2004 and in 2005. So they were at the table, they've had a number of years to work on this and to optimize it. In fact, their IP is also very portable. Their IP, their modem IP found its way, of course, into a lot of TI ASICs that were done for the Nokia phones that many of us carried 7 or 8 years ago.
And that same IP then went into an STE device called the U8500, and that U8500 was already qualified at places like Samsung, HTC, Sony, Yulong, Antim [ph], places
which improves the CPU speed by 25%, so a dual core running at 1.5 gigahertz, which will sell for a slightly higher ASP than the dual core. So we're already creating a family of LTE solutions for 2014, 1.2 gig dual core, 1.5 gig dual core and then, of course, the quad-core version of that same device called the M340 [ph], okay?
So for those companies that need to go quad core for the retail marketplace, we also have a solution. And as Scott mentioned, this chip now we feel confident sampling in first half of 2014, okay? So all this stuff is on track. So I feel good about 2014. And I want to make sure that everyone understands, our customers are reacting very well to this -- creation of this roadmap. Our customers really want an alternative supplier on LTE.
So let's talk about that turnkey design. So 71 days after the acquisition, I can hold up our turnkey design for the M320 or the EOS2, and this is a picture of the design on this slide, okay? What makes a turnkey different than a reference design? This turnkey is ready to go to production. A customer could change the ID, but we've already optimized the bill of materials. We've optimized the bill of materials with suppliers that our China handset partners like to use in China, okay? And we've gotten further to preserve their investment. I mean, the turnkey is all about making it easy for our handset partners to adopt the Broadcom complete solution. It's all about investment preservation and ease of adoption.
So I just mentioned, the family of LTE solutions, the M320, the M320+ [ph], the M340 [ph], okay? We made it even easier by making all these 3 chips pin compatible, same motherboard to support all 3 of these chips. And then we've gone further than that. We have also done software investment preservation. Once a customer or we port a customer's UI to our framework, the first handset gets done. We can quickly move to handset #2 and handset #3, a lot of reuse. And that's where the leverage is going to come from,
So let's switch back to 4G for a moment. Let's go into a little more detail on those 2 SoCs I showed you earlier. We're going to switch to a 3-digit part numbering scheme because I think a lot of the communities, both the customers and the financial community, thought our 5-digit part numbering scheme was too complicated. So we're simplifying our part numbering scheme and going to 3-digit part numbers. So EOS2 will now be referred to as the M320 design, M320 SoC. And hopefully, our 3-digit part numbers will be much easier for you to understand moving forward.
Let's talk about the M320. Available now, it's ready to go to production. This device is a 28-nanometer SoC, dual core that supports the 2 most popular implementations of LTE today, FDD and TDD. Recently, you heard that the China carriers were granted frequency spectrum using TDD. Most of the U.S. carriers are using FDD. This chip can support both. It also supports backward compatibility to all the relevant 3G standards, and most importantly, it supports new features that are coming in the marketplace as opposed to features that have already been deployed. Two examples of that: category 4 LTE. Most of today's networks that are deployed are using Category 3, which is 75 megabits per second. The world is moving right now to category 4, which is 150 megabits per second, and these chips will support that. Voice over LTE or VoLTE as we refer to it, again, a feature that hasn't been deployed yet, but will be deployed, and these chips support voice over LTE, with SRVCC fallback, by the way, which is the only type of VoLTE that could be deployed into the network, okay, dual-core A9 at right at 1.2 gigahertz.
When Scott was up here, he talked about our ability now to wring out some of the conservativism in the numbers we cited at the time of our acquisition. Now that we're in production with the M320, we're able to see some of the early yields. And now we're able to announce a new product called the M320+ [ph], which
which I'll go through in just a moment, and you can see some of the companies on the chart, okay? Companies like K-Touch, G'Five and then some leading India brand names like Karrbon and Micromax; carrier-branded phones from places like Idea Cellular, which is one of the top 4 cellular carriers in India.
So single-core, dual-core and quad-core phones all coming from servicing the developing regions of the world. And I anticipate that this trend will continue because our turnkey, as I'll show you in a moment, has progressed quite a bit from the early days of our turnkey design.
So let's talk a little bit more about some of this. Let me start with what we were able to do, proving that point about roadmap and roadmap leverage, having a customer start with one of our chips and then proliferate the roadmap. Let's talk about Samsung, the biggest smartphone company in the world, roughly with 1/3 of the smartphone market today. We now have multiple models in production from Samsung, single core, dual core and quad core; screen sizes ranging from 3-inch to 5.8-inch, okay? So I think this partnership with Samsung is very strong. And you can see, again, that roadmap leverage in this slide, okay, where having more than 1 product in the roadmap really makes a big difference and allows our handset partners to proliferate our technology across a range of handsets.
And let me talk beyond Samsung and what's happening with our 3G business. So right now, we have 2 Tier 1 companies we claim as our customers, ZTE, which is shipping the phone you see, our single-core HSPA platform, into places like T-Mo U.S.A.; and TracFone in the U.S.A., which is this largest MVNO, which is a virtual mobile operator; and Samsung, which we just discussed. What I'd like to announce today is our third Tier 1 OEM customer, HTC. And I'm holding in my hand and you could see on the screen, a picture of the Desire 601, which uses Broadcom's quad-core HSPA+ SoC, plus quad-core or quad-combo chip that I mentioned earlier, okay? So HTC is going to be our third, what I would consider, Tier 1 customer.
But then, beyond the Tier 1 customers that we're supporting with our cellular platform, we have been able to proliferate our technologies in places like China and emerging markets, okay? So if you look at the chart below, you'll see the number of handsets has extended. Last year, when I was here I talked about 44 different handsets from companies in places like China. This year, that number has exceeded 100, okay? So 100 different handsets from Broadcom, enabled by our turnkey design, whi
So for the dual-core shipping, in early 2014 it's now early Q1. And why do we have confidence to say that? We have a customer ready to go. We have a customer who's given us production orders, so we're in the process of building these phones, and Bob will say a little bit more about that. The quad-core we had for the middle of 2014, we now have that in the first half. So we've moved that up by roughly a quarter. Sample leadership LTE Advanced, we've moved that up by roughly a quarter as well, now looking to have that in mid of next year. Why are we able to do this? Two things: One, the integration of the acquisition is going extremely well. The team is integrated, hard-working, doing well, number one; number two, our engineers are executing on track or better, and so some conservative forecast we've been able to bring in, reflecting the quality of that work. So I'm pleased to say that the milestones we've shown you previously we're doing as well, or better than what we previously told you.
Mobile. Clearly, a lot of discussion in mobile about our position here, and I think we have a very strong position going forward, especially in the LTE space with the recent completion of the acquisition of Renesas. Here is an example of our LTE reference design platform; clearly, has world-class connectivity IP. I don't think there's any dispute about that. Again, you'll hear more about that from Bob. There are more chips on the back side of the board, so it's not obvious from looking at the front side where all those chips are. But we have WiFi, GPS, Bluetooth, NFC, all the connectivity on that platform. World-class power management and RF capability, and through, now world-class AP multimedia and through the recent acquisition, now world-class cellular modem IP. So all of the pieces in place for a complete LTE platform with world-class technology in each of the segments of that platform. And you, again, will hear a lot more about that from Bob.
Relative to the use of INTC on the foundry side, it left this open as a very real possibility and, in fact, our work indicates these two are already working together for I&N (not yet M&W).
And Oppenheimer & Co.’s Rick Schafer also reiterates an Outperform rating, and a $37 price target, writing that the company trumpted the virtues of its high level of integration:
BRCM repeatedly stressed the importance of platform leadership across each segment. BRCM will differentiate LTE with full (SoC) benefit of connectivity leadership.
Later in the day, the stock got a thumbs up from Jefferies & Co.’s Mark Lipacis, who reiterated a Buy rating and raised his price target to $36 from $32, writing that indeed, LTE-based smartphones will “translate to positive sentiment” in 2014, and help the stock’s P/E multiple expand. He offered a summary of remarks from Bob Rango, the company’s head of its mobile and wireless business, regarding the product outlook:
Mr Rango made the case that Broadcom connectivity solutions have 2x better throughput and 35% lower power consumption than competitive solutions, and that would enable Broadcom to maintain its market share leadership position in connectivity (Bluetooth + WiFi) chips in handsets. BRCM also announced that its M320 dual-core LTE SoC would ship into a Samsung phone in early 2014. Broadcom’s strategy is to provide a comprehensive best-in-class solution set including the LTE modem, application processor, imaging, video and graphics to its OEM
customers. In the emerging market, Broadcom now has a turn-key, cost effective LTE handset solution that emerging market OEMs could put into the market with minimal development cost and time.
Cowen & Co.’s Timothy Arcuri also today sounds a positive note on LTE:
Timelines accelerated across the board by ~1Q w/initial revenue now expected in Q1:14, while it officially announced Samsung as the first 4G LTE volume customer. Mgmt indicated “10’s of Millions” of units at implied platform ASP in the $18-20 range, i.e. very consistent w/our $400MM model and above many on Street thinking more like $150-200MM. Note this would imply ~5% global LTE share for ’14.
Arcuri thinks that the company is already partnering with Intel (INTC) to use the latter’s foundry capabilities to fab Broadcom’s next chips:
Touching on similar themes to last year’s meeting, BRCM will focus on design and less on shrinking to the next node with a majority of products staying at 28nm for next few years. Relative to the use of INTC on the foundry sid
7:31 am Broadcom raises its Q4 revenue guidance at its Analyst day (BRCM) : Co issues upside guidance for Q4 (Dec), sees Q4 (Dec) revs of $2.00-2.05 bln vs. $1.98 bln Capital IQ Consensus Estimate and above its prior guidance of $1.95-2.03 bln. The raised outlook was due to better-than-expected revenue in each reportable segment, particularly in Infrastructure & Networking.
Product Gross Margin: Improved the guided range for Q4'13 to down ~50 -- 75 bps on both a GAAP and non-GAAP basis.
R&D Plus SG&A Expenses: Reduced guided sequential growth range for Q4'13 to up ~$30-50 mln on both a GAAP and non-GAAP basis due to tighter expense management..
Global Equities Research‘s Trip Chowdhry today writes that he has been approached by clients asking him what he makes of the rumored iPhone deal between Apple (AAPL) and China Mobile (CHL). As I mentioned this morning, The Wall Street Journal reported China Mobile will start taking pre-orders for the iPhone this week, the first time the carrier has ever officially offered the phone.
Chowdhry, who has an Overweight rating on Apple shares, and an $800 price target, opines that details of the deal “are still sketchy,” and it remains to be seen what the price will be when the devices do go on sale.
But he thinks Apple can sell a large number of units at China Mobile, and that the sales may pull in users of Apple’s iPad and its Mac Computers, based on the following calculations:
a) iPhone is the Anchor product that brings the customers into the Apple Family; b) Depending on the geography 40% to 60% of iPhone users also become an iPad user; c) And about 20% of iPad users become Mac user. So the incremental opportunity based only on China Mobile only can be thought as follows: a) First 12 months iPhone Sales = 15 mil to 20 mil; b) First 12 months iPad Sales (40% to 60% of iPhone Sales) = 6 mil to 7 mil; c) First 12 months Mac Sales (20% of iPad Sales) = 1.2 million; d) Since, these all devices are manufactured in China, and the customer is also in china, their is ZERO Air-freight charges of Shipping, as it happens for USA customer. So we guess the Selling price of all the devices in China can be 10% less than in USA, while maintaining the same margins.
R.W. Baird chip analyst Tristan Gerra today reiterates an Outperform rating on shares of Broadcom (BRCM), and a $35 price target, writing that the company has seen a rebound in its sales of baseband modem chips for smartphones.
Broadcom has seen its market share at Samsung Electronics (005930KS) dramatically eroded by Marvell Technology Group (MRVL) and Qualcomm (QCOM) this year, but it may have better luck with new products in 2014, he thinks:
We believe Broadcom has won LTE sockets at Samsung, which will ramp in 2014, in a reversal post significant market share loss in 3G over the past few quarters at that customer. The LTE thin modem wins are based on Renesas’ architecture, as Broadcom’s internally developed LTE architecture had failed to gain any tier-one OEM traction, in our view. We estimate these wins will raise Broadcom’s baseband market share at Samsung in the high teens in 2014, up from below 10% currently. This compares with the 30%+ market share Broadcom had at Samsung in 3G a couple of years ago. Broadcom had lost most of its 3G share at Samsung this year, notably against Marvell and Qualcomm, due to its lack of quadcore architecture.
Next up for the company will be a product that integrates the baseband with an application processor, sometime next year, he writes.
Broadcom shares today rose 35 cents, or 1.3% to close at $27.88.
MADISON, Wis. — China's BeiDou satellite navigation system has become the biggest bone of contention in the Qualcomm vs. Broadcom competition to deliver more accurate positioning information to mobile devices.
Qualcomm announced late last month its support for the BeiDou constellation within Qualcomm IZat location solutions. The San Diego-based company revealed its collaboration with Samsung to launch the first wave of BeiDou-enhanced consumer smartphones.
Not to be outdone, Broadcom is introducing today, Dec. 9, the BCM47531, a new Global Navigation Satellite System (GNSS) chip that generates positioning data from five satellite constellations simultaneously.
In addition to receiving signals from GPS in the United States, GLONASS in Russia, QZSS in Japan, and SBAS (satellite-based augmentation system), Broadcom has integrated additional frequency support and digital processing capability for China's BeiDou constellation.
Adding BeiDou is critical, Mohamed Awad, director of product marketing for mobile and wireless at Broadcom, told EE Times, for enhancing navigation accuracy within China and elsewhere, particularly in urban settings where buildings and other obstructions can affect performance.
Developing GNSS chips that support various nations' satellite constellations -- including China's BeiDou -- is not just about responding to regional preferences and pride, says Awad. More important, the addition of BeiDou helps consumers anywhere in the world acquire more accurate positioning information, whether in Paris or San Francisco.
BeiDou consists of two separate satellite constellations -- a limited test system that has operated since 2000 and a full-scale global navigation system.
Its experimental system, also known as BeiDou-1, comprises three satellites, offering limited coverage and applications mainly for customers in China and neighboring regions.
The second-generation system, known as BeiDou-2, is still under construction. Upon its completion in 2020, a system of 35 satellites will begin serving global customers. Thus far, with 10 satellites in use, BeiDou-2 became operational in China in December 2011. It extended service to customers in the Asia/Pacific region late last year.
This Chip Stock Gets a Major Boost
By Ashraf Eassa | More Articles | Save For Later
December 6, 2013 | Comments (0)
There is a lot of uncertainty surrounding Broadcom's (NASDAQ: BRCM ) cellular baseband business. When the company's internal efforts hit a roadblock (and as a result, production shipments were delayed to the end of 2014), investors quickly bailed. However, in a bid to deliver value to shareholders more quickly, the company bought Renesas Mobile. A carrier-certified LTE modem and accompanying system-on-chip in hand, the company announced that it would begin to see material revenue in the "first part" of 2014. While investors have remained skeptical about the size and importance of the wins this solution could get, an initial read -- courtesy of J. P. Morgan's Harlan Sur -- suggests that Broadcom has won some major deals with its first LTE product.
A seemingly great start
According to Sur, Broadcom will have "significant deals" with Samsung as well as another "top smartphone maker" for its LTE products. It also appears as if additional companies are showing interest in Broadcom's LTE solution. While this isn't a surprise, especially considering that Samsung is a customer of Broadcom's 3G smartphone chips, this is exactly the kind of "confirmation" that investors (many of whom have grown impatient with Broadcom's continual slip-ups) have been looking for. So what kind(s) of deals could these be, and what can investors expect going forward?
Probably a low-end design
Broadcom's LTE system-on-chip features a dual-core ARM Cortex A9, which suggests that this is targeted at the low-end/mainstream portion of the smartphone market. So this isn't a "sexy" design along the lines of a Galaxy S5, but as players like Intel have pointed out, the vast majority of the units (and the growth) will actually occur in the mainstream/value segment of the handset market.
Furthermore, this helps bolster the company's connectivity business. At the high end of the handset market, device makers are concerned with features and performance above all else. This typically leads these players to go with discrete connectivity chips, baseband, and apps processors, as the freedom to choose the best part for each job is valuable. However, at the low end of the market, connectivity is viewed as a "good enough" type of thing, as these handsets are often built on shoestring budgets and the struggle for every gross margin dollar is tangible.
On the downside, this has meant that Broadcom has seen share loss to complete platform vendors such as Marvell and Qualcomm (NASDAQ: QCOM ) . On the bright side, once Broadcom is able to ship the "complete package," there should be material upside to revenue (as each "sale" includes a connectivity chip and an apps processor/baseband, among other chips).
A high-end presence is coming
It's tough to ignore the fact that, while Broadcom will likely gain share at the low end with its complete platforms, there's still plenty of opportunity at the high end. Indeed, while initial efforts are focused on getting a low-cost integrated system-on-chip to market, the company has made it clear that a stand-alone cellular baseband platform will also hit the market during late 2014. At the Credit Suisse Technology Conference, CFO Eric Brandt noted that this product -- complete with Cat 6, Voice over LTE, envelope tracking, carrier aggregation, and more -- would be out in the third quarter of 2014. This is a bit later than Intel's upcoming XMM 7260 (which supports these features), but should be right around the time when Qualcomm launches its next-generation MDM9x35 with said features (Qualcomm's product is sampling in early 2014 for launch in the second half of 2014).
Since high-end products tend to use discrete basebands, this would give Broadcom a shot at everything from a future Samsung Galaxy to a next-generation iPhone. While Qualcomm and Intel will also be viciously competing for these sockets, Broadcom will at least be better-positioned than it is today.
Foolish bottom line
Owning Broadcom isn't easy, particularly because the company has plenty to prove with respect to its cellular baseband business. But, if the long thesis is right and the company emerges as one of the last players standing in cellular baseband, then there's plenty of smartphone content share for the company to take and plenty of money to be made. If not, jettisoning this business could -- according to the Credit Suisse Technology Conference -- be worth 300-600 basis points in operating margin, and the money saved could be reinvested into one of Broadcom's other, thriving businesses.
Broadcom to host analyst day
Analyst Day to be held on December 10 at 8:30 am