T-Mobile Starlink, New Nokia CEO & Qualcomm Results – 5G Factor EP83

Hello and welcome everyone to the 5G Factor. I'm Ron Westfall, research director here at the Future and Group, and I'm joined here today by my esteems colleague, Olivier Blanchard, fellow research director and practice lead for AI devices here at the Futurum Group. In fact, uh, Olivier has been heading up our coverage of what's going on with AI devices.

And naturally in today's conversation, we'll touch on that. And naturally we have, I think, a lot of ground to cover here because there's always something going on, especially in the lead up to Mobile World Congress 2025, the first week of March. And so with that, Olivier, welcome back.

I know it's been what, a week. And so good to see you. Are things coming along, Things, you know, I can't believe it's only been a week.

It feels like a month already. It's been, it's been busy. We, while we've had a lot of, um, reports and dashboards and intelligence products coming out, so it, it feels like the last week was about two or three weeks packed into, you know, five days.

But yeah, it's Good. I understand. Yeah, No doubt.

No, no, I, I think that it does, uh, I think perception is key. It does seem like it, right? Yeah.

And maybe this week we'll emulate that. Uh, but that's good because that means the ecosystem that certainly the 5G and, uh, mobile ecosystem are having plenty of things going on, uh, that merit our attention and perspective. And yes, our friend AI is playing a role in it.

Uh, however, let's really focus on a, uh, I guess you could say a mobile centric announcement that came out during the Super Bowl, super Bowl 59. And during that, uh, momentous event, T-Mobile introduced T-Mobile Star link to millions of football fans out there. In fact, uh, this set a record, if I, uh, understand correctly, 126 million people sued into the Super Bowl, and that's, uh, including all the different platforms, and that's why a Super Bowl viewing record was achieved, even though the game itself wasn't exactly dramatic during the second half.

Now, uh, uh, back to T-Mobile, starlink the important thing here, and that it's in public beta, and it was developed naturally in partnership with starlink, and it's using satellite and mobile communication technology to help keep people connected. And why is that important? Because quite simply, there are more than 500,000 square miles.

That's a half million of, of the country that is here in the United States of America that are unreached by any carriers, earthbound cell towers. And that equates to about the size of two texases. Now, I think what's also important about this announcement is just not for T-Mobile customers to trial and test out.

I, I think, uh, it, it's in July that you have to start thinking about, okay, do I really wanna include this? And if you're already a a T-Mobile customer with a specific 5G plans, you can pretty much add it on after your trial, otherwise you could add it on for specific bees, but also Verizon and at and t customers can also trial this. And I think this is a smart move by T-Mobile because here is a way to really potentially garnish you customers from your top two rivals in a way that is, well, obviously legally sanctioned, but also, uh, smooth marketing, certainly from my perspective.

And other important takeaways here is that T-Mobile starlink is using specially configured satellites with direct to sell capabilities or direct to device. And that's orbiting, you know, earth about 200 miles up. And, you know, they're traveling at very rapid rates, you know, 17,000 miles per hour to be specific, to deliver these cell phone signals.

And that includes tech messages for now with picture messages with, uh, data and voice calls coming later. And that quite simply is filling a void that, again, earth cell towers can't really address today. And this is, I think, a very important part of, you know, how to we get what can be called universal coverage to, you know, really assure a society without, you know, digital divide, uh, because of, you know, connectivity, um, capabilities, uh, that can't, uh, be, um, reached, uh, the recent past, but now that is changing.

So that's good news for everybody. It's not just good news for, you know, T-Mobile, the mobile ecosystem, but really for society as a whole. And so with that, uh, kickoff, uh, Olier, from your perspective, what are some, you know, important takeaways and, uh, aspects to, you know, this announcement?

Yeah, well, fir first of all, uh, it's the mainstreaming of, uh, of satellite or, uh, near, uh, what is, what's the, what's the term? NTN Near Terrestrial Networks. Oh, yes.

Non-terrestrial network. Yes. Yes, indeed.

Um, I, I drew a blank just then. I was like, I thought I knew this, and it's been a while since I've actually said the words, so I, I blanked out. Uh, no, but it's, it's de it's further mainstreaming of, uh, of these networks, uh, by obviously not needing a, a dedicated antenna, but being able to, to access them directly on your cell phone.

So, a couple of things for me, I mean, obviously it's, it's part of an evolution. I think that we'll see this becoming much more mainstream, much more ubiquitous in, in years to come. Um, two, it's a proof of concepts.

I know that even, I wanna say two, three years ago I was at, uh, uh, 3G PP conference, and, uh, NTN was a big discussion, but there was still some skepticism about like, why would people pay extra for this? Uh, is it ever really going to be anything more than, you know, commercial application for truckers or for, you know, ships at sea? Things of that nature.

And now we're starting to see that, uh, for, for anything else, just the convenience of it, the security or the sense of security that, that we might feel from knowing that we're gonna be connected from anywhere, right? You could be, you know, out camping somewhere where there's no, no, uh, uh, antenna cell reception, but you can still be you, you can still send, um, you know, distress messages, uh, or like, Hey, I'm okay. Messages to your loved ones.

So you're never completely isolated if you don't wanna be. Um, and even just, uh, for, for everyday people who don't necessarily travel cross country or go into zones that, um, that have connectivity issues, sometimes things happen, things fail, right? There could be a natural disaster, like the hurricane that hit the, the Southeast, uh, a few months ago.

And that left us without internet or power for a while. Um, there, there could be fires in California that could be an earthquake, like whatever the reason, having that extra level of service that sort of bypasses terrestrial infrastructure might also be, uh, well worth, uh, the investment. And, and also having the ability to kind of turn it on and off at will, uh, not necessarily always having it on at all times is not necessarily a, a, a, a bad option either.

So I think, you know, this is good for starlink, it's good for T-Mobile. It's a great differentiator for them for now. Uh, and it's also good for consumers, and it's, it's also a market test.

Let's see, you know, after the, uh, the amount of exposure that T-Mobile had, and I thought that was, you know, obviously brilliant. Uh, traditional media isn't dead. So, um, that ad was really powerful.

So now let's see how, how well they convert over the next six months. Yeah, no, I think this is just a great way to start the flywheel to your points to the va. The beta is free, free until July, and I admit, I've signed up for the beta.

And what's I think important here is that TBOs, mobile starlink will be included at no extra cost on go 5G uh, next plans, you know, with, um, T-Mobile. So if you're already on the T-Mobile network and you have that plan, well, what's not to like? I mean, it's a proverbial no-brainer.

Also, uh, yes, it's important to consumers, uh, but also business customers can also get the starlink, uh, plan at no extra cost on go 5G business next. So this is really, you know, covering, uh, uh, that additional base. Yeah, I think that was something that's important to underline about first responders.

That is first responder agencies on t priority plans, and other, uh, select, uh, rate plans can also definitely, uh, add the service. Uh, and what I think is also important here is that when it comes to the Verizon at and t customers, they can add it after the beta for $20, uh, per month. Uh, I understand that now, uh, yes, uh, they're both also, you know, doing their own direct device, um, trials and so forth.

So yeah, this is definitely gonna intensify and pick up, but I think it's a tribute to, you know, the innovation that's gone on with the starlink Constellation Network and enabling this. And we've seen it no really, uh, prove a lifesaver in these, uh, natural disaster areas for the wildfires of Southern California, let alone, you know, uh, places like the, uh, Ukraine, uh, Russia, uh, campaign. So, uh, uh, you know, what's, uh, very vital here is that, uh, this will be a game changer as it becomes just that more mainstream.

And to add to this, I think it's important to note that also, um, carriers such as KDDI in Japan, Telstra, and Australia, as well as optis, as well as one nz, uh, the New Zealand and Intel and Schilling, Peru and Rogers in Canada, and Key a, uh, star and Ukraine are also on the bandwagon for this. So, you know, that is, you know, working with starlake in order to bring, you know, this, uh, you know, broader universalized coverage, and that is to, again, MA what can be called, you know, dead zones. Nobody wants that because of just what we touched on.

It could be emergency situations, unknown unknowns, and so forth. And I think that's something that, uh, will just be that a, a feather in the cap for T-Mobile as it, uh, looks to advance of this campaign. Now, with that, let's turn to another important development that, uh, just popped up on the radar, and that is Nokia has named a new CEO, and basically they picked Intel exec, uh, who is leading the AI data center efforts, Justin Hotard.

And that I think, uh, from my perspective, is a smart move. And what I think is important here is one doesn't have to be a data scientist to understand that, that this is also gonna do specifically for Nokia's portfolio wide AI and data center initiatives. And let's get some of the irony that's been noted out there out of the way.

You know, Nokia selecting Intel executive may seem a bit peculiar, given that Intel Silicon manufacturing problems a few years back led to a lot of heartburn for Nokia in terms of its, you know, a mobile, uh, access size, specifically radio access network, uh, capabilities. And that, uh, Verizon, a few years back turned to Samsung because Nokia was not able to, in some key ways, meet the Verizon demands. And what was this linked to?

Well, the little history here, there were delays in delivery of 10 nanometer asecs for their 5G base station equipment. And Intel was identified really as the blameworthy supplier in this instance. And that disclosure, I think, didn't really surprise, uh, many people at that time because of the manufacturing struggles that Intel was having at that time.

Now, NPI had then had to pivot to more expensive FPGAs, and that in turn, upset its gross margins alongside its technology competitiveness, which then triggered, uh, a loss of market share and that key market segment. And it, you know, it's been a challenge to recover since then. However, I think this is important to note that was a different era involving a different set of decision makers.

So, Justin Hoard coming on, I think is really a new level set. And again, I think it's very wise of them to go in this direction of, okay, how can we optimize AI capabilities across the entire Nokia portfolio? And yes, uh, uh, Justin is, uh, replacing, uh, Peka, Lendmark who I thought, uh, did a very, uh, outstanding job over overall in terms of getting Nokia in better shape over the last four years.

It's been challenging. They face a lot of headwinds. Uh, and also we saw that there was difficulty throughout the mobile ecosystem.

So this wasn't unique, uh, to Nokia in terms of what's been going on over the last few years. Uh, part of it is, uh, you know, was, you know, post covid related, and that is, you know, spending amongst, uh, the carriers on a global basis basically got dialed back specifically on the CapEx side. Now, what I think is, um, helpful in, in the near future is that that will start inching up this year and probably into the foreseeable future due to factor such as, okay, uh, operators exploring how to really optimize AI in terms of, you know, making them more, uh, competitive, uh, that is the service offerings, let alone, you know, the operations and the business processes within the operators themselves.

And, uh, just, uh, kind of an additional, uh, reasons why we can say this about, you know, landmark is that, uh, their share price has been improving 10%, uh, over the last, uh, four years. And that I think, is a tribute to, you know, okay, navigating some of these massive challenges that Nokia faced. 1%.

All these were really, uh, I would say achievements that, uh, showed that Nokia hit these high marks and that they were best within the last decade. Now, what I think is gonna be important here is what's next? You know, what can Justin Hotar do to really, you know, make, uh, Nokia more competitive?

And I'll stop here because Olivia, I think you might have some thoughts on, you know, why is Nokia really making this pivot to what can be characterized as an AI driven portfolio, uh, development strategy, let alone sales and marketing strategy? What are some of your insights on this move? Right.

Well, I'm gonna take a pass on that question and just like bounce it right back at you. Uh, I, I think, you know, I wanna know what, what, what you're thinking about it. Uh, but what I will say before, before that is, uh, I think it's interesting that, uh, Nokia is turning to, uh, uh, an AI and data center expert at scale, right?

At scaling these services, at monetizing this, uh, to, uh, to, to run. Its, uh, its company. So it's, I I think it's the, the question sort of answers itself.

Obviously, it's a pivot to AI and, uh, and they want the best talent on board to figure out how to do that properly. Um, the, the, this story is so full of layers of irony that we could, we could dedicate the, the whole show, we're talking about it, but obviously Intel's woes are Nokia's, uh, uh, advantage right now, because they're, I don't, I don't know that if, if Intel had had a better year, if, uh, if anybody had been trying to, to look for, uh, you know, Rosie or Verizon. So I think that the, the fact that he's jumping on board with this new opportunity where he's gonna be able to do something, uh, that he might not have been able to do at Intel, uh, something perhaps, I wouldn't say more important, but definitely more important to Nokia than it would've been in Intel.

Um, and, and the ability to kind of do this for the next few years and build something really special is, is obviously a part of the appeal. Um, my question to you though is, um, what's, what's Nokia's game plan for the next, you know, three to five years? Because that's, I think that's, that's the real question.

Like, how do they remain not just competitive, but relevance as the, the entire industry pivots to this, uh, to this AI stuff? Ah, thank you, Olivia. And yes, I do have some thoughts on this.

Now. I'm not gonna go as far out as five years from now. I can change, but I can say now, within the next, you know, one to three years, what I think, uh, are some important takeaways and, you know, what Nokia can do to just do that, improve its competitiveness, and certainly bringing Justin on is a, a, a key first step here.

But I think, uh, you know, specifically it's yes, uh, good news for the data center side of the business. I think, uh, we've certainly seen, you know, like Mike Bouchon who just came on, uh, you know, relatively recently over a year ago, and, uh, you know, basically head up, you know, energizing, you know, uh, Nokia's, uh, data center proposition. And I think what's gonna be integral to this is normalizing what could be, uh, characterized as matter of fact innovation in terms of how Nokia prioritizes its, uh, portfolio development strategy.

And that is, you know, things like making it easier to quite simply deploy a fabric. I mean, this is something that you'd think, oh, okay, it should just be, you know, uh, like do yourself proposition for organizations because they're big, they have these resources, they're prioritize, uh, prioritizing ai. But actually, no, uh, this is pretty much, I think coming out in some of our key recent future intelligence data.

Like when we, uh, surveyed 872 enterprise organizations, you know, what is the top thing they're looking at in terms of selecting, say, an AI solution, you know, an overall AI solution, and that is AI expertise. You know, they want their, you know, key, uh, supplier, their lead integrator, however you want to characterize it, to be the one that's going to enable really a comprehensive full stack vision and approach. And that, you know, would include, I would say, a lot of point products for that, uh, you know, lead vendor.

But, uh, ultimately, uh, that is something that is going to be a, a difference maker, as, you know, enterprises and so forth, figure out, okay, what is the best step? How can we rightsize language models and so forth? And this is something I think, uh, Nokia can play a more integral role in.

And that also, I think is also, it, it's simplifying the execution, the daily tasks around things like auditing and troubleshooting. And this is not unique to the data center. This would apply to all units in Noia, including certainly, you know, the mobile infrastructure side, including, you know, uh, any, you know, uh, software development initiatives that, uh, NOIA is, uh, has overtaken, uh, such as telco SaaS.

You know, that comes to mind, and I think this is something, uh, that is not just about the data centers, but really removing, you know, some of these, uh, you know, problems that continue to play, you know, making a real progress in terms of say, automation across, uh, the data center. What I think this is gonna enable is Nokia coming up and saying, Hey, we have to look at an organization-wide automation plan to really make something like automation more, well, uh, I would say advantageous to the customer that is, you know, improving business outcomes. It's one thing to have, you know, uh, say automation, you know, using AI enabled automation benefits, say, you know, some individuals or some units within an organization, but there, it stays.

It's, you know, pretty much, uh, siloed. But I think what's gonna happen here is that it's going to enable a, a portfolio development strategy and vision that's taking advantage of the intersection of what's going on with AI enablement. That is the workflows, the systems, really looking at the entire ecosystem capabilities that elite integrator can bring to really, you know, make that, you know, strategic difference to, uh, the customer.

And I think it's also making, uh, to your point, Olivia, about integrations more scalable that remove not just, uh, the effort involved, but also the time. And so this is really, I think, a way for Nokia to start looking at how they can show metrics that, okay, we can deliver time to value, uh, let alone time to market value from, you know, our, our portfolio assets. And this, I think, will definitely pull through things such as AI ran, which is kind of like a, potentially a new level set for, you know, how can mobile infrastructure be more efficiently deployed.

And so far, uh, it's still kicking the tires, but we saw with, you know, deep seek, you know, okay, hey, if ai, you know, technology could be a lot more power efficient, a lot more, you know, software agile and so forth at any part of the network, whether it's the data center, whether, you know, involves the training, let alone inferencing, this is, you know, something that's not just about, you know, the data center, but the entire portfolio, including the mobile infrastructure pieces and so forth. So, and in head shell, this is a, a very exciting move, and I think this is something where I see, uh, can make an impact in terms of, you know, answering the question why Nokia and how they could be, well, just that, uh, more differentiated, capturing more mind share out there. And so, uh, perhaps that's aligning with some of your thinking as well, Libby, in terms of, you know, what needs to happen to kickstart, you know, enterprise is getting more comfortable with ai.

Right? Yeah, no, I, I agree. That's like, I kinda wanted to hear it from you because I can see sort of like little bits and pieces of it, and I can see the, the overall shape of it, but I can't, um, you know, I, I focus more on the devices than, uh, than this part of the technology sector.

So there are still some, some pieces missing to this, so it makes sense. Um, yeah, and it's, you know, it's, it's too bad for Intel. They're, they're losing a, a really talented, um, leader and Yeah, at a critical time.

Yes. And they're already sort of like losing some of the other ones. So, um, yeah, I just, it makes me worry actually.

I think, you know, as good of a, a, a a, a pivot as this is for, for Nokia or at least the next, you know, milestone in, in their sort of transformation journey. It makes me worry for Intel a little bit more that, uh, some of their best talent is getting poached by, uh, uh, by other industries. So Now that's a legit point.

Yeah. No, I think we're not alone in that observation. Yeah.

And what will you visit Intel, but I think you mentioned devices. Mm-hmm. So last look at devices, uh, specifically, and as we know, Qualcomm recently re, uh, reported record Q1, fiscal year 25 revenue.

And how did this happen? Well, it was driven by strong premium tier handset demand, and also continue momentum and key segments such as automotive. And this, uh, really, uh, resulted in its six, uh, six consecutive quarter of record revenues.

Now, also, I think important to note is that all comm CDMA technologies or QCT revenues surpassed $10 billion for the first time while AI adoption across devices gain yet more traction. And so this is, I think, a real compliment to, you know, you know, what's going on with Nokia, and, you know, what can be characterized as, you know, some of the infrastructure, uh, developments. And I think what's also important about the Qualcomm, uh, results is that, uh, it noted that Google Cloud and Meta are among the early adopters of its own AI infrastructure initiatives, as well as that Verizon and Google Cloud are partnering on advanced AI services for network maintenance and anomaly detection.

And so while there's, you know, that those are certainly, you know, uh, the strengths, uh, but we also have to look at, you know, uh, you know, the concerns that might be out there. And that I think revolves in Qualcomm's technology licensing business or QTL, uh, there's, you know, ongoing negotiations with Huawei, and again, uh, that might, uh, have, you know, some impact on near term revenue stability. But overall, you know, I think, uh, you know, the results are pretty positive, even though there was some sell off on the street, you know, IEA bit of profit taking every, every time, Every time.

Yes. Yes. And, and seriously Qualcomm's expansion to IPCs, uh, automotive XR and also AI driven iot segment segments is, I think, validating its, you know, long-term growth strategy the Christiano Oman has implemented.

And I'm gonna stop there because, you know, uh, Olivier, what do you think about Qualcomm's recent results? What are some things that leap out at you? Right.

Well, many things. So first of all, I think that it's definitely a, a val, I mean, time will tell, 'cause we're, you know, there's still, there's still time to go. Um, but this to me, is, is further validation that's, uh, christiano's, uh, diversification strategy for Qualcomm that if he sort of kicked off when he became CEO, uh, a few years ago, uh, is paying off, right?

A lot of people are wondering, okay, like, we started out as Qualcomm being a, a, essentially primarily a mobile first company, right? So you had some network stuff, but it mostly, it was mostly like modems and the SOCs for, for, um, Android devices. And that was, you know, they had a few other products, but that was essentially like their core thing other than licensing.

And then we, we started seeing Qualcomm go into devices. So, uh, you know, smart watches and smart speakers and, you know, hearables and wearables, uh, uh, they, they went into, obviously, they, they, um, provide most of the processors currently for high-end xr. So all the meta stuff, Google, like, basically if, if you're, if you're wearing some kind of augmented reality, virtual reality, mixed reality, uh, glasses or smart glasses, there's a really good chance that Qualcomm tech is powering it.

Uh, obviously they have a huge play in automotive, right? With their digital chassis and their, um, their Snapdragon automotive products. And, and this year they went this, they, this, they did this leap into the, uh, PC segment.

So, uh, where we initially had essentially just Intel and, uh, a MD on the X 86 side, and you had Apple over here, and, uh, and you had Chromebooks. Now you also have arm base Snapdragon processors powering a I PCs. Uh, they were the first to market with Microsoft with this, and then Intel at MD followed.

Um, so they've, they've sort of like created all of these different runways to growth in addition to mobile and some of the network stuff that they had before, and iot, and what we're seeing is that it's working, right? Um, so I, I think that's kind of like the, along the broad lines, this diversification, this growth by chasing these different verticals that are very high growth, very popular right now with the most potential, uh, for expansion, uh, has been spot on, like they've been on Target, uh, a hundred percent. So I think you, you said it, um, automotive grew like 60 plus percent.

I think IOT grew over 30% as well. Uh, and then mobile was, uh, was pretty great. And then a, I, PCs, actually, it's still too soon to tell, but we just conducted a really interesting study of the A IPC market specifically for the enterprise.

So we left out, uh, the long tail of small to medium sized businesses. We didn't look at, uh, consumer yet. We focused on, on enterprise first, and we pulled almost 900, um, it decision makers in the enterprise space.

So big, big, big companies just see kind of like where they are with your A IPC adoption journey, uh, which processors they like the most, which ones they intend to buy for their, you know, the systems, like if they're gonna be powered by Intel, A MG, apple or, or Snapdragon, uh, which is Qualcomm's products. And we're already seeing that the, the intention, or at least I would say, um, when we asked all these IDMs what their first choice is so good for Intel, Intel is still number one still that could change in the future, but right now they're fine. Uh, number two was a MD just because it's index 86 systems.

So it works really well with the enterprise. It's proven, uh, at, at best they like it better than Intel. At worse, it's a really good backup, uh, in case Intel can't provide a part or there's a problem.

Uh, but Snapdragon, which is a new entrant into the space that has only been around for six months already turned up 15%, um, of IDMs basically saying that that's their first choice. That's how impressed they are with the ARM-based Qualcomm made Snapdragon X, um, IPCs. And, and so all of that brings me to kinda like the bigger points and the bigger trends in the industry and why I am probably here.

And it's that we're seeing an expansion of the AI ecosystem from cloud, right? It used to be data center because you just, it requires so much power and, uh, uh, and processing power. And so GPUs and, and all of this, all these massive resources to be able to train these systems to collect the data, process the data, just do all the, the, the training and the inference.

But what we're seeing is that there's, um, and in great part, thanks to Qualcomm, we've, we're being, we're, we're able now to move a lot of these AI workloads directly on device. So we're going from the cloud out to the edge, um, and whether it's an IPC or a new smartphone, like, uh, Samsung's, uh, galaxy S 25 series, which we talked about, I think last time it was on, uh, that just launched, uh, a couple of weeks ago. Um, the on-device capabilities for AI are so incredible that it's actually cheaper because you don't necessarily have to pay for subscriptions or, you know, tokens for, uh, for a cloud service to do that for you.

Second, um, it's, it's, it's really great because, uh, there's, there's that immediacy of interactions, especially with agent tech ai as it, it sort of like embeds itself to our user experiences. When you're interacting by voice with an assistant or an agent, and you're asking 'em to do something or you're asking 'em to answer a question, um, if your, your query doesn't have to go all the way through the pipes to, uh, a data center in the cloud, uh, where it's processed, and then like the answer comes back and has to come back through, you can have, you can have an immediate conversation with your, with your assistant on device that's gonna feel natural, that's gonna feel like you're in the same room with somebody without that delay. Uh, there's some some security advantages too, to having, uh, those agents directly on the device as opposed to in cloud, less risk of interception.

Uh, your data can remain secure. Even the training of, um, of, uh, of an agent over time with your preferences, the types of things that you ask when you ask them can stay on device inside of a firewall so that nobody has access to that. So there are a lot of advantages to moving, um, these workloads, uh, to, to devices.

And if you look at it more holistically, especially for the enterprise, the one of the advantages also is that you can have a more federated distributed AI ecosystem where you're not just dependent on cloud. Um, if you need to, you can even network a bunch of devices together to work on bigger problems that might be too big for one device only, but not necessarily requiring, uh, you know, a, a, a cloud-based solution to run it. So, um, you know, I, I think even, um, the, the warning shots that we got, uh, a week or two ago, I can't even remember how long it's been now with deep seek and the whole notion that we now have, um, AI models that can be trained on a, a fraction allegedly of the resources that we thought they could or they needed, uh, sort of plays into that.

Like, you, you can, we still need the data centers. We still need to build them, we still need the big GPUs. That doesn't change, but the, the trend towards smart devices being, um, a lot more capable of, of doing infrareds for sure, and eventually becoming better and better at training, uh, is gonna be kind of a game changer.

And where it's, it's most important, I think, is in, uh, not just the PCs and, and, you know, other devices, but it's gonna be in the automotive sector. And so for that, the, the two things that you need is you need, um, processors that are very good at, at doing AI workloads, right? So new, new processing units or, you know, GPUs that work really well in conjunction with the rest of the system, uh, is one piece of it.

But where Qualcomm is, is especially good 'cause they have that part is they do it at low power. And, uh, when you're looking at devices with, you know, small batteries, uh, or that have to process a lot of stuff, um, and you don't want 'em to overheat, you don't want 'em to need a lot of energy, it's really important for those systems of those processors to have extremely high output at very low power and be thermally efficient so that you don't need like massive fans to cool 'em in. And that's where, um, that's where Qualcomm excels.

That's where they have an advantage. So they kind of have the best of both worlds. Um, and the types of form factors that we're talking about from automotive all the way down to, you know, smart glasses, watches, phones, laptops, tablets, um, you have this sort of, you know, extremely advanced AI capability coupled with this very low power, uh, performance characteristic, uh, where essentially it's just like the best performance per what on the market.

And, uh, and that's why Qualcomm's numbers look the way they do that diversification with the right type of product for those applications that work extremely well with AI workloads. That's, that's kind of like the, the, the sort of cheat code or a cheat sheet to, uh, to Qualcomm's continued success. I think.

Um, and you know, I, I don't for prognosticate, but I don't see a reason why, um, Qualcomm wouldn't continue to have really good quarters, and because they've diversified, should one of those areas sort of, you know, slow down a little bit. Let's say the automotive sector slows down, uh, for a quarter or two, it doesn't really matter because they have all these others. They're also growing.

So there's, there's this constant sort of hedge against, um, sort of market slowdowns in different categories and Qualcomms there, as opposed to having all their eggs in one basket like they used to. Yeah, no, I, I, uh, fully concur with those insights, Olivier, and I'm gonna step outta the limb and do a bit of pro, uh, prognostication. And that is, um, when it comes to, um, uh, just a snapshot of the IOT segment.

And the reason, uh, why I'm doing that is because recently I was at the, uh, Zoho analyst event, and it's like, okay, Zoho, you know, they, they are a CRM specialist, you know, uh, what does this have to do with IOT? Well, lo and behold, uh, just in September of 2024, Zoho decided to toss its hat into the IOT segment, uh, specifically, uh, pursuing, uh, market opportunities in areas such as, uh, smart buildings, uh, know, manufacturing, uh, energy management and so forth. And, uh, they've done their homework, you know, their portfolio development strategy.

They realize, Hey, if we could incorporate these things with an overall CRM platform, that means, you know, extra revenue generation and so forth, paralleling Qualcomm's own overall, uh, what, what do you call revenue diversification strategy that is really, you know, making a huge difference for them. And I believe in 25, we're gonna see the IOT segment, uh, grow. Uh, you know, I would say not just an upward, uh, trajectory, but also robustly.

And a lot of this is, I think, related to, you know, the fact that snapdragons AI capable chip sets are delivering those low power capabilities that you pointed out, Olivier. And that could be, again, and a driver for, at at least industrial iot, uh, growth. And, uh, paralleling that is that they, I'm seeing that Qualcomm aware platform continuing to gain traction because it's integrating these AI powered monitoring and location capabilities across some of the segments I already touched on, such as, uh, you know, retail logistics, but also, you know, smart home applications.

And, you know, paralleling that as well is Qualcomm's on-prem appliance inference suite, which is, you know, helping enterprises with private AI deployment solutions. Something else that I think will have, you know, some, uh, market progress throughout 25 and beyond because of rising demand for wifi seven 5G FWA and really what could be, uh, called the edge computing market, uh, which I think, um, will, uh, I think, um, be somewhat buffered from, you know, potential tariff, uh, outcomes, which could impact, say, the automotive segment more. Uh, but again, uh, if you're looking at, you know, the overall picture, these are positives for Qualcomm and this cross pollination, I think we're gonna see more of it CM vendors jumping to iot and so forth.

And, and so this, I think so too A good, I think, um, I think the, the industrial IO OT or what I, I prefer to call the commercial IO ot, uh, segment is, is probably going to see a resurgence this year. Mm-hmm. Or at least start to, uh, it, it was kinda like, you know, an exciting thing, an exciting space for, for a minute, and then it just sort of fizzled out just for flattened out.

Um, but now with low power AI capable cameras, I think that especially cameras and, uh, drones are, are going to be hot this year. And what I'm seeing with Qualcomm, first of all, uh, at their, their, uh, analyst event in New York a few months ago, they spent way more time on the industrial IO OT than they normally, than they ever have. Uh, and more so than they did, uh, even with, uh, with automotive.

So obviously it's their Netflix push, um, but also what I'm seeing is a lot of services around it, a lot of orchestration, and, and I found that interesting. Um, so yes, I think you're on the right track with this. I think that we need to watch the iot space, uh, because it's, uh, it's gonna get hot.

And my, my question too is how much of that is, is wifi, how much of that is, uh, is 5G and, um, especially like private networks? And I think that there's, the verdict's still not out with that yet, but, uh, that's gonna be an interesting, uh, interesting, um, uh, ecosystem to watch, um, to see where it goes in the next couple of years. But yeah, definitely, definitely keep an eye on the AOT space.

Yes. Yeah, and, and to your point, Olivier, uh, Qualcomm made a splash, I believe, at, uh, last fall's embedded world North America, the first time embedded world has come to, uh, north America, and that was last October in Austin. And so I think that is another indicator, like this space is getting momentum, you know, the, the major shows are now diversifying on a geo basis.

And, and that is, I, I think proof positive, like follow the money. They're, they're not doing it because it's fun. It's because, yes.

Uh, revenue gener, well, maybe A little bit, maybe a little bit because it's fun, but yeah, definitely. It's a fun city. Yeah.

Yeah. It's, it's, it's more than a sushi and karaoke. There's also live music and barbecue, right.

So, Exactly. And well, hey, this is great. I think, uh, this is, uh, really touching on the, the, uh, the key, uh, things that jumped at us, but there's gonna be plenty more.

We'll be back next week because we're getting closer to Mobile World Congress itself. And I think this next episode will focus more on, uh, what, uh, I think our MWC, uh, 25 specific, uh, pre announcements. And so that, that, that will fill the cupboard.

And again, thank you Olivier, uh, for joining. Uh, again, uh, lots of, uh, I think great takeaways and conversation. Yeah, thanks for having me again.

Thanks for keeping inviting me. Like I'll, I'll keep coming. Right on.

Yeah, the invites will just keep, uh, flying out. And, uh, also, uh, with that, uh, don't forget to tune into 5G Factor, you know, we're on, uh, the future and group, uh, website bookmark us. Uh, and also we're featured on Textron tv, also, you know, part of the future and group family.

And, uh, with that, uh, again, thank you everyone and have a great 5G and industrial or commercial IOT Day.