Qualcomm Inc. has ended its collaboration with Iridium Communications Inc. to provide satellite connectivity for Android devices.

The chipmaker disclosed its intent to scrap the deal last week, Iridium announced on Thursday. The agreement will officially end on Dec. 3. Shares of Iridium, a McLean, Virginia-based satellite operator that trades on the Nasdaq, dropped more than 5% today following the news.

At last year’s iPhone launch event, Apple Inc. introduced an iOS capability called Emergency SOS. It allows users to text emergency services via satellite even if they’re beyond the reach of the nearest cell tower. Four months after Apple’s event, Qualcomm previewed a competing feature for Android handsets that used Iridium’s satellite constellation to facilitate communications in remote areas.

The Iridium constellation comprises more than 80 satellites that were launched by two separate companies over the course of about three decades. The first company was a dot-com venture backed by Motorola Inc. while the other, Iridium, is the constellation’s current operator. It deployed its newest batch of satellites earlier this year using a SpaceX Corp. rocket.

Iridium’s satellites send data through a section of the radio spectrum called the L band. Radio waves in this frequency are not susceptible to interference from rain, fog and other adverse weather conditions, which makes the technology suitable for emergency communications. The tradeoff is that the L band provides limited bandwidth, meaning it can only be used to power fairly simple communications applications.

When Qualcomm and Iridium first detailed their partnership, they stated that the goal was to provide two-way texting for emergency use on Android handsets. The companies suggested that the feature could eventually be extended beyond smartphones to other types of devices. Apple’s satellite communications feature, Emergency SOS, only provides one-way texting and isn’t available on devices other than the iPhone.

In its announcement of the Qualcomm partnership’s cancellation, Iridium detailed that it has “successfully developed and demonstrated” the satellite communications feature the companies had announced. The reason for the cancelation appears to have been lackluster demand. “Notwithstanding this technical success, smartphone manufacturers have not included the technology in their devices,” Iridium stated.

Despite the setback, the company plans to continue exploring business opportunities in the mobile market. Iridium stated that now the Qualcomm deal has been scrapped, it can ink partnerships with rival chipmakers as well as handset manufacturers and operating system developers. The company will offer prospective partners the option to play a role in shaping its technology development roadmap.

“While I’m disappointed that this partnership didn’t bear immediate fruit, we believe the direction of the industry is clear toward increased satellite connectivity in consumer devices,” said Iridium Chief Executive Officer Matt Desch.

Iridium doesn’t expect the cancellation of the Qualcomm partnership to affect its 2023 financial results. Last month, the company projected that it will close the year with service revenues about 10% higher than the $534.7 million it generated in fiscal 2022. Iridium has also reaffirmed its plan to achieve about $1 billion in annual service revenues by the end of the decade.

There’s still a possibility Qualcomm will introduce a satellite communications feature in the future. The company is the top supplier of modem chips and antennas to the Android handset ecosystem. If demand for satellite connectivity increases significantly among mobile device makers, Qualcomm would have a strong incentive to integrate the technology into its chips. 

Photo: Qualcomm