Press Release

Qualcomm Leads Wireless Packet Data Innovations with Dormant Mode and Mobile IP Capabilities

Feb 24, 1998ATLANTA

Qualcomm products mentioned within this press release are offered by Qualcomm Technologies, Inc. and/or its subsidiaries.

Qualcomm Incorporated (NASDAQ: QCOM) today announced the introduction of two innovative features that enhance basic packet data capabilities, providing both operators and consumers with economic and functional benefits. The Dormant Mode feature is a key enabler in making data services cost- and resource-efficient for operators and consumers. Mobile IP (Internet Protocol), the Internet proposed standard for mobility, adds functionality to CDMA networks by offering seamless mobility to data users. Mobile IP is implemented in Cisco's Internetwork Operating System (IOS™) software, which is integrated in Qualcomm's QCore™ Base Station Controller (BSC). Qualcomm, the first wireless network supplier to demonstrate basic packet data services at CTIA'97, continues to lead the industry in CDMA wireless data as the first vendor to implement these enhancements to packet data.

"The combined expertise of Cisco in networking solutions and Qualcomm in CDMA wireless solutions has resulted in a foundation for a new generation of data applications and services for the mobile professional," said Cliff Meltzer, vice president and general manager of IOS Technology and Engineering Operations at Cisco Systems Incorporated. "The synergy between Cisco IOS software-based Mobile IP services and Qualcomm's CDMA data services will provide wireless operators and customers new freedom and cost-effective flexibility in providing and using wireless data services."

"Our goal is to deliver data services that are beneficial and useful to both CDMA operators and CDMA customers. With these new innovations, operators can offer advanced data services while utilizing their network resources and spectrum efficiently," added John Major, president of Qualcomm's Wireless Infrastructure Division. "For example, the new Dormant Mode feature will reduce airtime charges for CDMA subscribers while their data connections are in 'sleep' mode, and operators can allocate this unused capacity to other subscribers on the network."

Basic packet data utilizes IP to transmit "packets" of data over a CDMA link, and is optimal for applications that send and receive data in bursts, such as sending and receiving e-mail, browsing the World Wide Web, or querying the Internet. Packet data offers a direct connection to the Internet in two to three seconds, and requires no "modem training time."

With Qualcomm's new Dormant Mode feature, network resources are consumed only when data is being sent or received, resulting in benefits for both wireless operators and customers. In effect, the data connection goes into a "sleep" or "dormant" mode after a specified period of time passes without any data packets being transmitted. While in "dormant" mode, a Point-to-Point Protocol (PPP) connection is maintained without actively using a traffic channel on the network, and the traffic channel can be allocated to other users on the network. When the user needs to send or receive a data packet, a traffic channel is automatically reactivated, making the "dormant" period transparent to the user. Hence, customers benefit from less airtime charges, and operators can allocate resources to other customers on the system in between bursts of data.

Dormant Mode is a key factor in reducing the costs of wireless data services to the consumer, as it introduces the concept of billing for data transmissions as they actually occur, as opposed to billing for the full duration of a data connection. In addition, operational costs to the carrier on a per subscriber basis are inversely related to the number of subscribers generating revenue on the network. Thus, the reallocation of "dormant" resources to revenue-generating users positively impacts operator profitability.

Mobile IP, an enhancement to basic packet data services, allows users to maintain a continuous data connection and retain a single IP address while traveling between base station controllers (BSCs) or roaming on other CDMA networks. Maintaining a consistent IP address, as with Mobile IP, gives the user transparent access to the corporate Intranet and the freedom to roam seamlessly between their wired home networks and wireless CDMA networks.

Packet data, which is part of the IS-707 data standard, is currently supported for speeds up to 14.4 Kbps, and will be commercially available on Qualcomm infrastructure in March 1998. Dormant Mode and Mobile IP services are planned for commercial availability in the second half of 1998.

Basic, Dormant Mode and Mobile IP packet data services can be readily implemented in Qualcomm's QCore BSC with the appropriate CDMA datasoftware, and the addition of an off-the-shelf Cisco network router with Cisco IOS software. The router can be connected directly to the Internet, allowing operators to bypass the public switched telephone network (PSTN) when offering Internet access to their customers. The CDMA data software, Cisco router platform and Cisco IOS software can be shipped fully configured from Qualcomm's wireless infrastructure factory.

The QCore BSC, which includes an integrated Interworking Function (IWF), dynamically allocates resources for fax, voice and data on a per-call basis. This means that all system resources are available for any type of call, and the system can easily accommodate a change in the mix of data and voice calls in real time. The QCore BSC, which employs a streamlined architecture designed specifically for CDMA, offers many advantages to operators, including reduced capital investment, faster implementation of new features and services, and simpler resource planning.

Qualcomm's CDMA systems employ a "packetized" backbone for voice, so packet capabilities are already inherent in the equipment, allowing for easy integration of packet data services. Because data is handled similarly to voice in the network, CDMA's inherent variable rate transmission capability also applies to data services, allowing the data rate to be determined by the amount of information being sent. Therefore, CDMA data utilizes system resources on an as-needed basis, resulting in even greater spectral efficiency for operators.

Qualcomm's integrated, single-platform solution for standardized IS-707 data services, including circuit-switched data, digital fax and enhanced packet data, operates in cellular, Personal Communications Services (PCS) and wireless local loop networks. As the developer of CDMA, Qualcomm continues to demonstrate its expertise in maximizing the performance of CDMA technology across its infrastructure equipment, subscriber products and Application Specific Integrated Circuits (ASICs). Qualcomm continues to invest in research, development and standardization of new CDMA features and services, as well as enhanced digital wireless technologies.

Headquartered in San Diego, Qualcomm develops, manufactures, markets, licenses and operates advanced communications systems and products based on its proprietary digital wireless technologies. The Company's primary product areas are the OmniTRACS® system (a geostationary satellite-based, mobile communications system providing two-way data and position reporting services), CDMA wireless communications systems and products and, in conjunction with others, the development of the Globalstar™ low-earth-orbit (LEO) satellite communications system. Other Company products include the Eudora Pro™ electronic mail software, ASIC products, and communications equipment and systems for government and commercial customers worldwide. For more information on Qualcomm products and technologies, please visit the Company's web site at http://www.qualcomm.com.

Except for the historical information contained herein, this news release contains forward-looking statements that are subject to risks and uncertainties, including timely product development and commercial implementation of the Company's products, as well as the other risks detailed from time to time in the Company's SEC reports, including the report on Form 10-K for the year ended September 28, 1997 and most recent Form 10-Q.

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