Episode 48: Qualcomm - Broadcom

Acquired

Ben Gilbert and David Rosenthal

Venturecapital, Ma, Investing, Acquisitions, Startups, Vc, Investment, Business, Technology

4.8 • 2.9K Ratings

🗓️ 20 November 2017

⏱️ 56 minutes

🔗️ Recording | iTunes | RSS

🧾️ Download transcript

Summary

Ben & David cover the proposed largest tech M&A deal of all time, and in the process dive into the evolving dynamics of the industry that started everything in Silicon Valley—silicon. Just when VCs thought innovation was dead in semiconductors, a new wave of startups and large companies are redrawing the lines of competition in an industry dominated for a half-century by the “Wintel” duopoly of Intel and Microsoft.

Sponsors:
Vanta: https://bit.ly/acquiredvanta

Statsig: bit.ly/statsigacquired
Modern Treasury: https://bit.ly/acquiredmoderntreasury

Topics Covered Include:

Innovation and disruption in the semiconductor industry over the past two years
Intel’s acquisition of Nervana
Graphcore and other ML-focused semiconductor startups
CDMA and the telephone network effect
Qualcomm’s early cell phone handsets
Vertical integration + commoditization in smartphone chipsets

The Carve Out:

Transcript

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0:00.0	Are you drinking whiskey?
0:01.2	No, tea.
0:02.4	I was like, that's a big cup of whiskey. Welcome back to episode 48 of Acquired, the podcast about technology acquisitions and IPOs. I'm Ben Gilbert.
0:24.0	I'm David Rosenthal and we are your hosts.
0:27.0	Today we are covering what would be the biggest tech acquisition of all time
0:32.0	Broadcom acquiring Qualcomm and as the biggest tech acquisition of all time,
0:32.5	broadcom acquiring Qualcomm.
0:34.7	And as we record, the current status of the deal
0:37.2	was it was rejected today for a price of 103 billion dollars,
0:42.4	not including the, or I guess accounting for the debt that is part of the deal.
0:46.9	And it'll be really fascinating to see how this unfolds in front of us, David.
0:50.8	Yeah, the Battle of the Combs. Yeah, 1m versus 2. Who will win?
0:56.0	Reminds me of 3 Com. Yes. It's incredibly incredibly creative names in this industry.
1:03.4	Yeah, well I think one of the themes we'll get into today is what's old is new again.
1:09.6	So, you know, it's like we're back in the year 2001 here okay so for for listeners who are maybe
1:15.6	not as as deep in in semiconductor companies and I'm wondering sort of what these
1:21.5	companies do.
1:22.9	They're both effectively fabless semiconductor companies.
1:26.8	So neither of them have fabs, which are the fabrication
1:31.0	facilities that actually manufacture the chips.
1:34.0	These days, with the exception of maybe Intel, Samsung, T-S-M-C,
1:40.0	most of the chip designers are not actually the chip manufacturers because it's so expensive to create them.
	...

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