Welcome to episode 208 of the G2 on 5G. It's the latest insight scoop on everything 5G. We cover six topics in about 20 minutes, and it's brought to you by More Insights and Strategy.

I'm Will Townsend, and joining me again this week is Fellow Analyst, Anshel Sag. But before we get started, just an apology to our viewers and listeners. Anshel and I have been road warriors. I was on the road three weeks in a row in October, including some international travel. You've been traveling quite a bit as well, my friend, right? 

Yeah, I traveled for the first few weeks of October. I've had a couple weeks off, but I'm about to hit the road again in Austin and Manchester next week. 

Nice. Yeah. I've got a week home and then I'm back on the road, including a trip to Tokyo to spend time with NTT. It's just unrelenting for us, but that's what we do as analysts.

We travel the world, but with that, let's jump into my first topic. And I want to talk about snap dragon summit. So this was the first year that I had an opportunity to attend. It's held in Mali. It's just a beautiful setting and it is Qualcomm's opportunity to talk about all of the products that they're focused on this year.

There was a big focused on AI first experiences. In fact, CEO Christiana Lamon. Talked about how Qualcomm is enabling that with what they're doing in mobility and in automotive.  Now, typically buddy, this is your coverage area. You had a conflict. So I stood in, I did write a Forbes article. If our viewers and listeners are interested, go hit my social handles.

That was posted last week, but I want to talk about the snapdragon eight elite.  And for those of you that are not familiar with it it's almost like a mini data center tech stack. It offers the elite eight now, or the eight elite now offers the second generation Orion CPU. That's something that you're going to talk about related to arm in a minute here, but it includes also the Adreno GPU and the hexagon NPU.

And it's an impressive tech stack. It is something that's going to be offered and new mobility products. And I hypothesize that platform could actually be used in next generation edge and security infrastructure. The company has proven, its ability to extend into new segments like automotive.

Where now it is established itself, very firmly, but very impressive. I know you weren't there, but you are going to be writing this up, shortly. What were your general thoughts about summit this year? 

I thought it was an interesting summit. Obviously the focus was on smartphones and automotive this year.

Yeah. There wasn't any talk about XR or PCs. But there was a strong suggestion that we will probably be getting this second generation Orion in a PC sometime soon. Which would be great because the first generation I think did a pretty good job and offered something actually competitive for the first time in a very long time from Qualcomm.

But the second generation really seems to amp that up to the next level. And it's, actually competitive with Apple's, current Silicon, not last generation Silicon. I think we're going to actually see some really interesting products next year based on that. But yeah, the snapdragon eight elite is interesting because it's the first elite in the smartphone segment.

And I think that if you look at the way Qualcomm's naming scheme works, elite looks like it's going to be the one that has the Orion CPU in it, whether that's X elite or that's eight elite or automotive. And the automotive products are those were also announced at the summit. Okay. And those were around ADAS and around cockpit.

That was about, all the partnerships they have with all of the large automotive OEMs. I believe they, they also had someone from Mercedes F1 team on stage, Total Wolf. That's obviously not part of the auto, but it's part of their sponsorships. They had some partners on stage as well.

And, Qualcomm has quite the automotive design pipeline. And Mercedes was actually on stage to talk about their, they're working with Qualcomm for their next generation vehicles. The Snapdragon eight elite was an interesting one. I will be getting my hands on some of the new Snapdragon eight elite devices fairly soon.

I will be attending a North America launch of the one plus 13, which just was announced in China with this chip and that will be a cruise to the Bahamas. So I miss out on Hawaii, but I'm not missing out on a fun launch. I'll be talking about that and giving that coverage and I'll probably, bring it up on the podcast when I get back.

But yeah it's exciting. And I'm unfortunately I wasn't able to attend this year, but I'm glad you were able to go to Hawaii for me. 

Yeah, no, it was fantastic. I got to spend a lot of quality time with various executives, including Christiana Oman and I was very impressed with his overall vision for AI first experiences and what Snapdragon is enabling to do that, like you mentioned with ADAS and the Intelligent Cockpit, but just with all the different devices.

And what was really interesting this year, too, is that his keynote featured A lot of customers from Ford to Mercedes, like you were mentioning to all of the device manufacturers. So it was really a great display of Qualcomm demonstrating all this design wins. And I got to say, the the eight elite is a very, powerful solution. What I would deem to be a mini data center tech stack on a mobile device. But with that, let's go to your first topic. And that was a pretty good segue for what you want to talk about. Because that same week there was a lot of news around Arm and Qualcomm and their continued IP dispute.

Yeah, so this is an interesting dispute.  I've been covering it for quite some time and ultimately I think it boils down to a disagreement over who's in control of the destiny of Arm. And what that means for arm and for Qualcomm and the whole industry. And really this should, this is, I believe the difference between these two companies is a few million dollars, which is ridiculous when you consider that there are billions of dollars on the line for both companies.

But I think the important thing here to remember is arm is still majority owned by SoftBank. SoftBank ultimately makes the calls. And there was a point where ARM was to be acquired by NVIDIA and wasn't. And I have a strong feeling that Qualcomm was one of the companies that may have pushed for that not to happen.

I think there's a little bit of animosity here due to that. Also Qualcomm is building a product technically competes With what arm has on its IP side. So while Qualcomm is no longer using arm IP in the sense of the design of the course and they're just licensing the architecture, which. Arm has now notified Qualcomm that they're going to be canceling, which is insane.

 Ultimate reality is that Qualcomm  has produced a more efficient more performant core than Arm. And I think that's also not good for Arm's business. And if more of Arm's customers move to Qualcomm chips, Arm makes less money. I think this really boils down to the fact that Arm is quite  Competing with Qualcomm in some ways and Qualcomm is competing with ARM.

Automotive is also a big factor. If all the automotive vendors go to Qualcomm, they might not end up using ARM cores or ARM based designs in their in their SOCs. There's a probability in auto that might also be reason why arm has done this. But the problem with this is that it makes a lot of arms customers uneasy about how the future of arm might be and how arm might come after them in the future.

So I think that's a big challenge. And the truth is the RISC V community is benefiting from this, which is a competing architecture with ARM. They are nowhere near the maturity where ARM is today. But there are a lot of projects and a lot of semiconductor companies that are RISC V and some are already shipping RISC V cores.

I think we're going to see RISC V continue to ramp as a result of this it started with the acquisition of ARM by NVIDIA. That was Pandora's box opening and With this lawsuit, I think Pandora's box has been opened further. So I think this is a net negative for both Qualcomm and ARM and it should have settled and it hasn't and it will be going to court next month and that is why I believe that ARM escalated this to another level with the cancellation of Qualcomm's license.

And both companies have put out statements that are I don't know, hyperbole in my opinion. But the reality is that this hurts both companies and it's ultimately net negative for both of them. And I think if, this goes to court next month. I don't think it'll be good for either company and ultimately it'll be a lose.

You're very close to this much closer than I am. But isn't there also another wrinkle here? So Orion, that's a product of a company that Qualcomm acquired. Is it Nuvia? Am I right in that assumption?  

And that's the basis of all of this. 

Yeah. And I think the contention is that with Qualcomm acquiring that company, they're assuming that the license is passed through.

To me, this looks like arm is trying to squeeze. It's one of its biggest customers, licensing customers for more money. 

So the reason why I believe Qualcomm says they don't owe ARM any more money is not just that Nuvia had an architecture license to do this, but Qualcomm already had an existing architecture license as well.

The reason why they didn't renegotiate or transfer the Nuvia license was because they already had an architecture license agreement with ARM. So I believe that's why they don't think they need to negotiate a new license. And that's also why I believe ARM believes they should have to negotiate a license because they don't think their existing architecture license was good enough.

Obviously Qualcomm's was probably negotiated at a lower rate than Nuvia's was. And that's probably why they went that route. And I'm sure that Qualcomm was trying to be cheap and save money. And her arm didn't like that, but I guarantee you that this is has to be millions of dollars gap between the two companies and will could potentially cost them billions.

I just don't get it. 

Yeah. It's like throwing the baby out with the bath water. It's. It's interesting. It'll, pop your popcorn and we'll see what happens in court. It's because it's coming up pretty quickly here. But hey, let's go to my 2nd topic and I want to talk about AST space mobile.

I did share some insights while I was on the road, but. A couple of things have happened. One the company has successively folded out its its antenna arrays tied to its first five commercial satellites. And then, quickly on the heels of that news,  there was an announcement that AST Space Mobile is now going to participate in a contract and serve as a prime contractor for the U S department of defense.

And I've got the details here. It's quite interesting. There is a a program called the hybrid acquisition for proliferated low earth orbit or halo program. And so what this is going to allow AST is again, participate as a prime contractor, lean into it's very strong intellectual property, and this could potentially drive more opportunities for the company, especially as it readies its Next tranche of of satellites that it plans to launch into low earth orbit next year.

What are your thoughts? On the surface, this is like super positive for AST space mobile. 

I think they're just on a run, I think they, they really had some struggles early on. But I think they've hit their stride and, the satellites are up. And they're unfolded.

And they're continuing to gain momentum with customers. And I just think that they finally hit their stride. And, if you look at their share price, it definitely feels Hey, 

where is it? I haven't even looked at it recently.  

I, it was North of 50 last time I checked, but it, or sorry, North of 30.

But it was like, Okay, now it's down to 23, but yeah, I mean it was like what two three bucks when we were talking about them earlier this year Yeah so they've obviously taken quite the they peaked at 40 ish 40. Yeah about 40. So yeah, I think they're gonna be pretty stable with these wins.

And yeah, I just think That it's good for there to be competition in this space. We didn't have this as a topic, but I'm going to add it since we're talking about space and connectivity. Apple made an investment in In global star and they invested 1. 1 billion, got 20 percent and they're getting their own constellation, which they'll have 85 percent of the bandwidth for which makes Apple almost their own ISP now.

And then the remaining 15 percent will be for global star to use for other customers. Global star having new constellation with Apple is T space mobile with AT& T and a bunch of other companies, including Verizon. And then, Starlink. Finally getting some clearances as well with T Mobile.

So I think it's great that we're having real competition and, things are starting to become real. 

I totally agree. Like I always say, competition tends to breed innovation. And it's good 

that we have three, at least three solid prospects. 

Yeah, I agree.  Hey, buddy, let's go to your second topic.

And you want to talk about the iPhone 16 and it's not really being that well received across the at least in the U. S. Across the M and S, right?  

Yeah. So this topic was before Apple released their earnings. I would say that Apple's sales are not getting boosted as much as people would have expected due to Apple intelligence, however the numbers are still showing that they were able to sell 6 percent better, so they were, they still improved, which is good for them.

But I gotta be honest with you. I think most of those sales were a result of. obnoxiously generous offers. I'll tell you when I was looking to, at the new iPhone it was like basically my wife's iPhone 13, which isn't really worth anything anymore. Was able to be traded in with no additional money.

For a 16 pro. Wow. So it wasn't just a lateral upgrade. It was actually a real upgrade to another tier for no money added. So that was a, I think that was a T Mobile offer, but honestly, I think most carriers were offering that. And that's extremely generous. And then I also got an offer from AT& T because I'm an AT& T fiber customer that if I added an AT& T cellular line to my fiber, I could Business, they would give me a pro max for free with a three year contract, but still free.

I think the offers were extremely generous, but the numbers aren't as bad as they looked But I also think apple knew that was going to happen I think that's why they incentivized a little bit better offers because offers were just insane 

Yeah, it's apparent. You're an expert on devices.

I'm not as close to them as you are. But the iPhone 16 looks pretty thin. And in fact, our chief analyst, Patrick Morehead, said the same thing. He couldn't find really anything that was that compelling to move them, to an upgrade. And he's someone that's a power user. He's upgraded every 

my, my biggest recommendation to anyone who was looking for a new iPhone or still is looking for a new iPhone is you don't actually need to buy the pro max anymore because the pro max used to be where they kept all the best camera features.

Now, the regular pro and pro max have the same camera capabilities. So I personally I'm using a pro. I don't have a Pro Max anymore because it's so unwieldy. Here's an example. I've got a 15 Pro Max next to a 16 Pro. They have the same, this one has the better camera but it's so much smaller, like it's not even I don't know. It's not even close. Yeah I'm I'm very happy with it. I think it's a good phone. Battery life is excellent. A lot of people complained about battery life on the 15 pro max and 15 pro. So it's a good upgrade for anybody who doesn't have a 15 because the 15 still gets Apple intelligence.

Actually 15 pro. But yeah, I think Apple could have done better if Apple intelligence was available sooner. And I think probably By Q1, it seems like they'll be back on their regular stride, or maybe there will even be a super cycle because people will actually be able to use them to add intelligence.

Yeah I think the most exciting thing around this set of announcements and, I think you mentioned on a prior podcast that Apple will be breaking up, the product announcements moving forward, but the Milanese band for the the ultra watch. So I, I spent the 200 on that.

I'm quite happy with it. I just put it on my ultra watch this weekend. But yeah, hopefully, Apple will, bring something that'll move the needle a little bit further. Let me get your thought on Apple intelligence since we're talking about. Aren't they? Isn't just a clever way for Apple to package a lot of generative AI features that are already available?

No, some of them are new features. The reality is that it's an upgrade to Siri, which is like the big upgrade, but there's also like Genmoji and a bunch of other things. The problem is that you actually have to sign up for it as on a wait list, part of a beta. So it's not actually a commercial full release.

And it does do summarization and help you with writing, but it's not a fully featured Apple intelligence yet. So I think we're actually. Because I said that, Q1, we're probably not going to get the full, capabilities of Apple intelligence until first half of next year. 

Mhm. Cool.

Got it. Hey, man, that's a great segue for my third and final topic. And I want to talk earnings because it is earning season. We are a little late here because we've been on the road and we're recording this podcast a little bit late, actually, in the month of November. But let me run through kind of some top level thoughts with AT& T Mobile and Verizon, starting with AT& T.

From a wireless perspective, 19 consecutive quarters. With this three Q of 200 K plus net ads. Definitely a bright spot. Mobility revenue continues to be flat. And that's the case for Verizon as well. But I do believe as ASD space mobile begins to put more satellites into space that there could be opportunities for monetize.

Rural mobility services, such as agriculture technology deployments and that sort of thing. Smart farming and in ranching and that sort of thing. From my perspective, pretty decent performance from from a three key perspective. Now, T Mobile. They smashed it again.

Their FWA 5G business is over 6 million subs. They're getting into fiber and it seems, you and I were at that that capital markets day in San Francisco several weeks ago. And really with. With this sort of double down focus on broadband, I think T Mobile has a lot of upside, not only to grow its FWA business, but also grow a fiber footprint as well.

Now, Verizon, similar net ads, the stock is down basically flat, revenue wise. And it's, this is the second consecutive quarter that, that lower equipment revenue has really impacted their earnings. With all of that said, what are your takeaways here? Is, does Verizon continue to still appear to be on the ropes?

T Mobile continues to, to chug along. The FWA business is certainly a very bright spot for them. AT& T just seems to be slow and steady. And I'll also mention AT& T announced a very interesting converged gateway product. I've shared some details on that on social media on my handles.

It's really innovative. It's basically a converged gateway so that if, if there's a fiber cut or an outage, it automatically flips to 5G fixed wireless access to provide uninterrupted performance. The application for that is certainly within branch locations that a minute down equates to revenue loss.

Think about convenience stores. Think about oil change places. Think about any business that's service oriented that has to have constant and reliable connectivity. But with that said, what are your thoughts about the earnings on these companies? 

I think it's just a continuation of the existing trend.

I think Verizon may have stabilized a bit. But I think their biggest challenge is that  a lot of their value proposition is in their edge compute. And because they don't have standalone, that edge isn't as powerful. So I think their. unwillingness to be aggressive on standalone deployment, I think is hampering their ability to compete with T Mobile.

I think AT& T continues to chug along, like you said, slow and steady, but I don't see them really unseating Verizon or T Mobile in the, network performance categories. I do think that there are some talks from, more spectrum availability, which I think would benefit AT& T the most.

Because it seems like Verizon and T Mobile have the most spectrum, and it seems to be helping them with network performance. But I also think that, one of my other topics is, Might help AT& T down the road which is FirstNet. We'll see what that ends up doing for AT& T, but ultimately I think the pecking order remains as it is.

And the truth is, I published my article about T Mobile's capital markets day that we both attended. And the truth is T Mobile just is not letting off the gas pedal and not just that, but they are full heartedly embracing AI to continue to accelerate their growth and their efficiency and their network.

And I just think that while AT& T and Verizon seem like they're still figuring out their networks and their infrastructure, T Mobile is already moving on to the next phase of their network. And I think it's going to be really hard for Verizon and AT& T to catch up because they still haven't even deployed standalone fully.

I do think I did see Verizon talk about having GPUs in the cloud. It seems like Verizon may be just a fast follower behind T Mobile and some of these trends. And yeah, I did love what I saw from AT& T on the converged gateway. I think that's super awesome. I do think it would benefit more than just Fiber customers if they did this for, even a U verse customer.

Because the fiber deployment is big. I agree. I think it's the biggest in the country, but it's not big enough. I think for this business to be, or this gateway to be as useful as it could be. Even I, who I'm like a staunch, loyal AT& T fiber customer. So I would love to have to, because just to have a backup, cause the truth is fiber is almost perfect in terms of reliability compared to fiber. 

Coax. But it still goes down periodically. And even if it's down for three hours, that's still time. That's valuable. And honestly, like I've been an AT& T fiber customer now for eight years, and I think I've had a total downtime of three or four hours over those eight years. So it's really, it's great.

But yes, for businesses, I think it's super important. I will also say that I don't think it's, this is how you achieve some of those SLAs that guarantee, nearly 100 percent of time. 

Yeah.  Great insights, my friend. Hey, so you teed up your own third and final topic, but you want to talk about FirstNet, and they are gaining some more spectrum.

So let's share, let's hear the details on that. 

Yeah, in a 4 0, 4 0 vote, not vote, a 4 0 vote the FCC gave FirstNet an additional 50 megahertz of spectrum in the 4. 9 gigahertz band. This is interesting because 4. 9 gigahertz is a a band that can be used for automotive applications. So there are some requirements for transmission and listening.

But ultimately what this does is it gives. First net more spectrum, which I think they absolutely do need. And that means AT& T gets to manage that spectrum for first net customers and has more of a pool of spectrum to work with. And I think this is great because one, it makes first net better, but also it also says that maybe first net does need more spectrum and more I know the word I'm struggling with it right now because it's a Sunday, but Capacity.

Thank you. Yes. Capacity. So I think the T Mobile T Priority business will be fine as a capacity adder. 50 megahertz is not going to make or break the FirstNet experience. But I do think it will make it better and I think it will make it more useful for first responders. So I think it's a net positive, even though I know Verizon and AT, Verizon and T Mobile are unhappy because AT& T is getting the spectrum.

I still think FirstNet Should get the spectrum and it's good for them to have it. Hey do you think that maybe some of the justification or the reason why this happened was around the hurricane response and all of that, having those two hurricanes back to back, in the concern of providing enough, capacity to FirstNet for first responders. 

I could see that being a possibility, but the truth is the government bureaucracy moves so slowly that I don't really, I don't really believe that like it made that big of a difference. Ultimately, this had to have been a discussion that had been going on for months, if not years. And it just happened to land right after two hurricanes devastated the southeast.

But yeah, I think it's a net positive for everybody. And I don't really think it changes the landscape that much other than making FirstNet a little bit more robust. 

Yeah, I think you're right. Cool. Hey, my friend, it's been another great podcast. Why don't you take us home?  

Absolutely.

We hope our viewers and listeners found this week's topics interesting. If anyone out there would like to provide insights on a specific 5G topic for a future podcast, please reach out to us on social media. Will's at Willtown Tech and I'm at On Shell SOG. We hope you have a good rest of your week and please tune in again next week and don't forget to rate and subscribe.