Earlier this month, Xconomy reported that San Diego’s Ethertronics raised an additional $4 million in a secondary round of venture funding. Yesterday, I sat down with Sahil Bansal, Ethertronics’ director of strategic marketing, who explained how the company has emerged as a specialist in embedded antennas for cell phones and how it’s planning to use the new funds to move into the next-generation of wireless devices through “active antennas” for tuning into a diverse spectrum of mobile TV, FM radio, Bluetooth, and other services.

Ethertronics co-founders Laurent Desclos and Sebastian Rowson started the company in 2000 to commercialize new antenna technology known as IMD, for Isolated Magnetic Dipole. As Bansal explained it, both IMD and conventional embedded antennas are mounted on a circuit board and excited by an electric current. But with its patented IMD technology, Ethertronics can confine the current in the antenna element more effectively, which keeps energy from being dissipated through the circuit board and to surrounding components. Isolating the antenna in this way makes it more efficient, which allows for smaller effective antenna size and improved overall performance when a caller asks, “Can you hear me now?”

The innovation enabled Ethertronics to get its first patent in 2003 and its first order in 2004 from South Korea’s LG Electronics, currently the world’s third-largest handset maker. In the next two years, Ethertronics got its first orders from Samsung and Motorola.

Bansal says the privately held company now holds or has applied for more than 50 patents and ranks as a leading provider of embedded antennas for the wireless industry. Ethertronics has more than 180 employees, including about 35 at its San Diego headquarters and R&D center. Most of Ethertronics’ other employees work in South Korea, Taiwan, and China, and 80 percent of its global workforce is in engineering.

Ethertronics says it has shipped more …Next Page »

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I was a little surprised yesterday when Enerdyne Technologies, a subsidiary of Carlsbad, CA-based ViaSat, said encryption technology is now available for its digital data link systems to unmanned military surveillance aircraft.

Isn’t the video transmitted from robotic spy planes already encrypted?

Not necessarily, says Enerdyne general manager Steve Gardner. As it turns out, it’s possible to buy a standard commercial FM receiver used by TV news organizations and tune it to “eavesdrop” on the analog video signal transmitted by several different types of robotic aircraft used by the U.S. military. He says in the early years of UAV development, aircraft companies encrypted the digital electronics used to control UAVs, but “typically chose small analog transmitters” to broadcast video signals from the aircraft to ground units. That could be a problem if the eavesdroppers are U.S. adversaries in places like Afghanistan and Iraq. Gardner says whether that scenario should be a concern has become a hot topic of discussion these days in defense circles that are focused on the development and use of UAVs, or unmanned aerial vehicles.

Gardner says Enerdyne now has developed a module that can be installed aboard a UAV, between its camera and analog video transmitter. The module, which is a little bigger than a handheld calculator, digitizes and compresses the video signal so it can be encrypted without necessitating changes in the analog video transmitter aboard the plane or in U.S. equipment receiving the video signal on the ground. Enerdyne uses another module on the ground to decrypt the video signal.

“From the perspective of the FM equipment that they have on the airplane and on the ground, they can’t tell the difference,” Gardner says. The innovation reflects …Next Page »

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Perhaps because they operate in heavily regulated industries, electric and gas utility companies are not usually regarded as centers of innovation. And to some critics, the utilities operated by San Diego’s Sempra Energy seem to operate in stodgy defiance to anything shiny and newfangled.

But it’s a bad rap to Hal Snyder, who oversees strategy and program development as vice president for customer programs at both San Diego Gas & Electric and Southern California Gas Co. Both utilities are owned and operated by Sempra, and account for more than half of the company’s profits. Snyder and other utility executives talked with me at length about some of the technology advances they have underway and the innovations needed to change the way energy gets distributed in Southern California.

“We have been involved in fuel cell projects, sustainable energy community projects, and photovoltaic solar panels installed in various places,” Snyder says.

In July, SDG&E became one of the first utilities in the country to begin the full deployment of so-called …Next Page »

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Innovation never sleeps, but the pace of San Diego business and technology news yawned a little over the Christmas and New Year holidays. Still, there were plenty of noteworthy developments to round up for the first Monday of 2009. Oh, and by the way, Happy New Year!The end of December brought news from faraway China that the world’s largest telecom market is starting a long-delayed upgrade to 3G, or third-generation, wireless technologies. That could be good news for San Diego’s Qualcomm (NASDAQ:QCOM), which said it signed a licensing agreement with China’s largest cell phone maker, Beijing Tianyu Communications Equipment Co.

Was anyone surprised when Dow Jones VentureSource announced that liquidity events for venture-backed companies fell to their lowest level in five years in 2008? The data shows that only seven venture-backed companies in the entire country completed IPOs, raising a total of $551 million. San Diego’s CardioNet, which raised $54 million in March, was the region’s sole IPO of the year. And for all of Southern California, the data show only 27 buyouts, generating a total of $919 million.

San Diego venture capitalist Kevin Kinsella became “The Big Man in Town,” and left the rest of us feeling like a “Rag Doll,” after becoming a major financial backer of Jersey Boys, the smash Broadway hit. Our account of how it all happened is here.

San Diego’s Volcano (NASDAQ: VOLC), which makes vision systems for detecting artery blockages and other problems, says it plans to buy Axun, a privately held laser maker in the Boston area, for $21.5 million.

Christmas came a little early for San Diego’s CalciMedica, which got …Next Page »

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The economic downturn means it’s likely the wireless industry will stay with third-generation, or 3G, technologies for the foreseeable future, Qualcomm’s top executives said last night during a panel discussion.

Qualcomm CEO Paul Jacobs said customers of the San Diego wireless giant have pushed out their chip orders for 3G technologies because of the economic downturn, but the company is looking for a business rebound in the second half of 2009. He cited the “uncertainty of consumer demand” as a key underlying issue, but Jacobs also noted that sales of 3G handsets based on Qualcomm technology have increased 25 percent over last year.

The panel discussion at Qualcomm’s corporate headquarters, in the 534-seat Irwin M. Jacobs Qualcomm Hall, was billed as a “town hall” meeting by CommNexus, the San Diego telecom industry association that organized the event. “It’s meant to disseminate ideas, share knowledge, and build networks with industry peers,” CommNexus CEO Rory Moore told the audience.

Jacobs, who was named as Qualcomm CEO in 2005, is the son of Qualcomm founder and chairman Irwin Jacobs. The second-generation CEO was joined by his second-in-command, former Sprint executive Len Lauer, who was named as Qualcomm COO in August, and by Steve Mollenkopf, who also was named in August to head the all-important QCT, Qualcomm CDMA Technologies.

So in a way, the event featured the 2.5G version of Qualcomm management discussing 3G technologies and the prospects for 4G products and services.

But for all the discussion about digital wireless technology, the Qualcomm chips in the Blackberry Storm and Qualcomm software in Google’s Android operating system, about USB dongles, and LTE versus WiMax, what may have been the most interesting question didn’t come until the end.

“What do people misunderstand about Qualcomm?” asked Iain Gillott, the wireless industry expert who was recruited as moderator for event.

“From a PR point of view, I think the way we are most misunderstood is from the newspaper headlines and everyone attacking our licensing model,” said Lauer, referring to industry complaints about the high cost of Qualcomm’s licensing deals. “What they miss underneath that is all of the innovation and research and development we do… opening mobile radios to new apps and services.”

CEO Jacobs added that because of Qualcomm’s patent lawsuits against Nokia and Broadcom, “You think this is a litigious company, but we did not go out and sue everyone first… Our (business) model is built around licensing. We have one of the broadest models. We don’t sell cell phones to end users. We work with partners. We consciously developed this strategy of working through partners and we go to our partners and say we’re here to be a good partner with you.”

It was an interesting moment of executive self-reflection, especially since a federal appellate court last week upheld most of a lower court’s findings against Qualcomm in a patent dispute dating to 2003. The court found substantial evidence that Qualcomm had deliberately withheld its proprietary video compression technology from a standard-setting industry group, a move that left room for Qualcomm to later file a patent-infringement lawsuit against Broadcom, a rival chipmaker in Irvine, CA.

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The phrase “preaching to the choir” came to mind as I listened to the speakers today at the 3G CDMA North America Regional Conference, which is being held this year in downtown San Diego at the U.S. Grant Hotel.

Seated in the audience around me were representatives of wireless carriers, equipment makers and device venders that have all based their products on CDMA, the digital wireless technology also known as Code Division Multiple Access. Many listened while scrolling casually through the electronic messages on their presumably CDMA-based gadgets, their faces illuminated by the light from their hand held devices.

The conference, organized by CDG, the CDMA Development Group, has always been a CDMA family affair—focused exclusively on the proprietary digital wireless technology developed by San Diego-based Qualcomm.

James Person, CDG’s chief operating officer, kicked off the conference by announcing there are now 475 million worldwide subscribers to the CDMA family of technologies. While that number has been growing, it represents about 18 percent of the global market because most of the world uses rival wireless technologies based on GSM, or the Global System for Mobile Communications. In North America, there are about 140 million CDMA-based subscribers, who account for 51 percent of the wireless market—with most of those customers using CDMA-based networks operated by Verizon Wireless and Sprint.

Considering how competitive the U.S. market has been over the past 20 years, it seemed like Person was over-reaching—or perhaps just talking to the CDMA faithful—when he said, “In North America we are the dominant technology, and we think it will continue that way.”

Such comments reflect a confidence in the future of CDMA technology that is frequently expressed by CDMA insiders. They also say that it’s easier for CDMA-based networks to make the transition to next-generation technologies such as EV-DO (Evolution-Data Only)—which also provides superior bandwidth for data-intensive applications, such as Web-browsing and online gaming.

It’s reminiscent of arguments that Sony’s Betamax videotape format was technically superior to JVC’s VHS standard, and we all know how that ended.

The key to CDMA’s future only became clear to me after presentations by executives for Sprint and Verizon Wireless, who laid out their efforts to create “open ecosystems” for encouraging other “third party” developers to invent new CDMA-based products and services.

“Rather than us defining where we want our customers to go, our customers now have the choice to decide where they want to go in an open ecosystem,” said Kevin Packingham, Sprint’s senior vice president for product and technology development. By enabling third parties to develop new applications for Sprint’s wireless customers, Packingham said, “I don’t need to create a new messaging portal for our customers. All I need to do is make it possible for our customers to plug into their own messaging system.”

Since Sprint launched its strategy in 2001, Packingham says the carrier has registered more than 135,000 software developers and certified more than 200 wireless devices for use on its networks.
Verizon started a similar effort a year ago under Tony Lewis, Verizon’s vice president for open development, who proclaimed yesterday, “My job is to fuel innovation, to get out there with the partners.”

It seems like a smart approach, although it could take years to play out. It’s also hard to tell if it’s really going to work when everyone in the audience is nodding their head in approval.

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As the CDG North America Regional Conference convenes in San Diego today, Perry LaForge, the trade association’s chief executive, says he has a lot to feel good about.

LaForge says he started working on behalf of CDMA, or code-division multiple access, after getting a preview of the wireless technology in 1988, when San Diego’s Qualcomm was barely three years old. It wasn’t until 1989 that Qualcomm co-founder Irwin Jacobs actually demonstrated his concept to the telecommunications industry.

“I pulled together the initial carrier consortium,” says LaForge. “I worked with the Japanese and Koreans… We convinced Samsung and LG to produce cell phones based on CDMA.”

LaForge’s has a bigger and more formal role now as head of the CDG, the CDMA Development Group. Looking back over the past 20 years, he says, “I think we have fundamentally changed the wireless landscape…We fundamentally changed an industry” that had already committed to a rival wireless technical standard. “It’s something that I take a great deal of pride in.”

The CDG represents roughly 100 leading CDMA operators and wireless equipment manufacturers. Yet as several hundred people gather for the two-day conference, industry questions about the viability of CDMA still seem to linger.

Even though Qualcomm ranks today as the world’s second-biggest maker of wireless chips, the rival GSM Association (for Global Systems Mobile communications) says 82 percent of the global market for mobile devices is based on its digital technology standard.

Despite GSM’s global dominance, and a broader migration to next-generation GSM technologies, LaForge maintains that CDMA operators continue to upgrade their networks to provide capacity for escalating voice and bandwidth-intensive data traffic

“There’s a lot of talk about 4G systems, but one thing I suspect is that when there are economic downturns that people tend to hunker down with the systems they have,” LaForge says. CDG members also have worked aggressively to reduce costs, getting the cost of CDMA handsets below $30 apiece, LaForge says.

The global economic downturn became apparent at Qualcomm earlier this month when the chip maker reported a 22 percent drop in profit in the quarter that ended in September.

Qualcomm CEO Paul Jacobs told analysts last week that in the face of slowing demand, the company has stopped developing a next-generation wireless technology called Ultra Mobile Broadband, or UMB. Jacobs says the chip maker will put its resources into another high-speed technology called Long Term Evolution that Verizon Wirelss and other major customers have backed.

Jacobs indicated, though, that he expects the wireless industry to go through a pause, rather than a downturn, amid the broader financial crisis—a sentiment that LaForge echoed in our conversation yesterday.

“The macro-economic environment obviously impacts a lot of different sectors,” LaForge said. “But a lot of folks believe that the wireless industry in general will probably fare better than other sectors.”

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