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Broadcom Pledges To Make US the Global Leader in 5G

10 March 2018, 01:06 | Myrtle Vega

Broadcom Pledges To Make US the Global Leader in 5G

Broadcom Qualcomm bid US 5G technology Qualcomm smartphone chips Broadcom 5G network Committee on Foreign Investment in the United States wireless technology R&D spending semiconductor industry

Broadcom's statements indicate that it is looking to take a "private equity'-style direction if it acquired Qualcomm which means reducing long-term investment, such as R&D, and focusing on short term profitability".

Broadcom also stated that it would work with the government of United States as it drives to accomplish and sustain the global leadership in 5G.

Broadcom pared that back to $117 billion last month after Qualcomm raised its own price for chip maker NXP to $44 billion. Broadcom is based in Singapore and is in the process of moving their headquarters to the United States and becoming a USA company.

The company said Wednesday that it expects the move to be completed by May.

His letter follows an announcement by the Committee on Foreign Investment in the U.S. (CFIUS), which includes representative from several U.S. agencies and departments, said that it was concerned that the takeover would cause the U.S.to fall behind in the global race to build reliable 5G wireless networks - threatening U.S. security.

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In the response, Broadcom pledged on Wednesday to maintain Qualcomm's R&D spending on 5G, and to create a new $1.5 billion fund to train and educate the next generation of engineers in the US.

CFIUS plans to further assess the proposed acquisition to evaluate the potential security threat.

A weakened Qualcomm could hand over 5G telecommunications prowess to Huawei Technologies and perhaps other Chinese companies, which have been investing heavily to gain a beach head in 5G technology ahead of the transition from 4G networks. To quell some of the concerns, Broadcomm inked a letter to Congress assuring members that it has every intention of making the United States a leader in 5G connectivity, and that it would not spend less money on advancing 5G stateside. China wants desperately to take the lead in technology from the US and 5G is only one of several areas they are eager to control. "Broadcom will not only maintain the R&D resources Qualcomm devotes to 5G and innovation in future wireless standards - we will also focus R&D spend to those critical technologies that are essential to the USA", says Broadcom.

Broadcom said on Friday it expected to complete its move to the United States by May 6. As part of the that, Broadcom also pledged to work with the U.S. government to achieve its 5G goals, as well as future ones.

"Hostile takeovers typically destroy the viability of the acquired asset because they are massively disruptive and the acquired employees aren't slaves and will oppose the new management", he said.

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