Thread regarding Qualcomm Inc. layoffs

For the vast majority of the mobile phone market, the chips and physical "devices" are rapidly becoming loss leaders. When this happens, it doesn't matter so much who manufactures the device--as opposed to it's capabilities running the software/applications efficiently. Arguably, it is a less efficient model for a business to manufacture in the U.S. when this happens.

There are two exceptions: (1) Early innovators--the people who just have to have the latest technology; and (2) Aesthetes--the people who value form or design as much as functional utility. (Think Apple.) These smaller segments of the market are willing to pay an artificially inflated premium for what they perceive to be a "better" product, and for having it before all of their friends do.

Both of these segments of the market depend heavily on innovative research and development--something Qualcomm seems increasingly reluctant to do.

Many engineers at QC came from Intel, and so, it is only nature for them to go home. When the QC loses its licensing advantage, it will know what it means to compete in chip business. It is brutal. Up in Silicon Valley engineers need to change jobs periodically, because companies fail regularly.

This how QC started; creativity and innovation (that was back when Irwin was running the show, he believed in his employees and trusted them to do the work). Now it is totally the opposite; it is managed by a warehouse mentality who believes in how many chips he ships out every day. And he's closing every CORP R&D project and laying off people. Most of these smart engineers will end up at Intel and will come up with great products for Intel. I have 4 friends who got laid off by broadcomm and got hired in Intel's Arizon's office to work on modem technology.

The Jacobs have to wake up and do something about these new gangs who are ruining this company.

Maybe some people are overlooking Asia’s ability to mass produce. That ability exists in every field as soon as they gain the expertise. That is where American outsourcing comes in to help. Soon, they will mass produce innovation. It has happened in Japan, Korean, and Taiwan. It will happen in China, as well. Why, financial reward. That is the only thing that matters there. They buy iPhones and drink Starbucks for only one reason . Don’t get too caught up about their long tradition and history.

I think it has more to do with corporate survival of a US company competing i n a now global economy.

Things would be different if QCOM's #1 customers are in the U.S. But it isn't. QCOM is competing in Asia, specifically in China. We're not talking even about competition from mainland China. MediaTek is a Taiwanese company.

When Google bought Motorola, Motorola tried to manufacture phones in the U.S. in Texas... After burning through millions, they closed the factory down without making phones. Why? For $15-20/hr, people aren't going to do the work...For $15-20/hr, people who want to do the work don't have the skills to do it.

http://www.theverge.com/2014/5/30/5764836/motorola-shutting-down-us-assembly-plant

Even Samsung makes a lot of their phones in China.... And once labor costs increase anymore, companies will end up moving to another cheaper labor area. (Vietnam maybe?) and the cycle repeats....

The problem with technology, unlike any other product, is that even with non-inflation adjusted dollars, consumers expect to get more and better things and pay a lot less for it... Think about your computer. Back in 1984, the first Mac costed me $4000 with a printer....Today, people expect to be able to buy a computer that is 100x more powerful that costs 1/4 the price of what it did in 1984... And that's not even inflation adjusted....

That price pressure tells you one thing about technology.. The only way to charge more for something, is if you can create something "new" that consumers are willing to pay for....But once out there, it's price/cost will be in steady decline....

Technology is one of the industries you really have to love to be in..Because it's probably one of the few industries that price does not adjust up for inflation. In fact, it continues to go down...

Just about everything else however adjusts up for inflation..Food, materials, construction, housing, etc...

totally agree .... "labor gets outsourced but creativity doesn't"..... but it is corporate greed which led to outsourcing of jobs....for short term gains they screwed up the long term objectives... for creating something you need small set of people and not thousands....and that is the problem with .... creativity has to be protected.... Intel and Apple are two companies who have relied on that..... Qualcomm should not have sold themselves to China/Samsung..... "saving money" through outsourcing is priority rather the innovate and make more money