Qualcomm acquires NXP: The move is all about auto

While we know of Qualcomm's presence in smartphones, smartwatches and appliances, it was easy to spot that in the automotive space there was not much happening. And that' exactly what Qualcomm pulled off today by acquiring NXP Semiconductors N.V. for $47 billion.

Qualcomm recently held a 4G/5G Summit in Hong Kong to answer one simple question. What is 5G? At the announcement, Qualcomm revealed how it would connect the world using the next generation network and its upgraded arsenal of 5G ready modems and chipsets, that are not just for the premium smartphone segment, but the masses. If something moves or connects to the internet, it's got to have Qualcomm chipset inside (one way or the other). Qualcomm at the event also pointed out how the 5G works as a unifying fabric that could connect everything from computers, automobiles, and even your smartphone to the cloud. While we know of Qualcomm's presence in smartphones, smartwatches and appliances, it was easy to spot that in the automotive space there was not much happening. And that's exactly what Qualcomm pulled off today by acquiring NXP Semiconductors N.V. for $47 billion.

NXP is no small fry. While you may have never heard of the brand, a component from NXP may already exist in your connected car. And they come with plenty of experience. NXP is the leader in high-performance, mixed-signal electronics. It also holds leadership positions in the automotive industry when it comes to products like broad-based microcontrollers, secure identification, network processing and RF power. In short, with Qualcomm's 5G infrastructure in place, you could probably head to a petrol pump, fill your car up and the car could pay for itself (from your account of course). The whole process of your car staying connected, providing you with data that could save you from mishap on the road ahead, and even payments, thanks to the acquisition will now be controlled by one company and that's Qualcomm.

Qualcomm acquires NXP: The move is all about auto

Image Credits: GSMA

It almost seems like carpet strategy for taking over the automotive space with 5G, but it's not just for now, as Qualcomm is looking at the future with autonomous and electric cars as well. It's not that Qualcomm was completely out of the automotive space, it's just that Qualcomm's modems for helping auto manufacturers connect their cars is just not going to cut it when electric and autonomous cars go mainstream. With this focus in mind, acquiring NXP is the best thing that Qualcomm can do to get access to more critical and core components that will force automotive manufacturers to pay up when it becomes the standard.

With the Germans and the Americans, ramping up their electric offerings for 2020, and Tesla already showcasing the self-driving technology, that autonomous future which was expected to arrive five years down the line, is already here. And now it's the component makers who did not see it coming that are now playing catch up!

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