UC San Diego finds itself in the crosshairs of the largest tech deal in history. Well, maybe. Singapore-based tech giant Broadcom is gearing up to buy our own tech titan: Qualcomm. With a huge offering of $130 billion and recent attempts at a hostile board takeover, Broadcom is making moves on Qualcomm, to say the least. All the while, UCSD stands to lose big — or maybe win bigger than ever before. In acquiring Qualcomm, Broadcom should take advantage of our pre-existing relationship and work with us to usher in a new era of innovation and synergy.
For some background, Qualcomm is known for being “the name behind the name,” including our own. Responsible for creating the chips that make our smartphones smart, Qualcomm has played a pivotal role in the tech device industry since the 1980s and was founded by our own former professor, Irwin M. Jacobs. Ever since UCSD has relied on its relationship with Qualcomm to grow and prosper. Thus, anything that happens to them happens to us. Moving to the modern day, Qualcomm has struggled with its chip manufacturing profits, relying instead on revenue from licensing agreements and patent royalties to keep the company afloat. Enter Broadcom.
Broadcom swiped right on Qualcomm back in November, coming to the table with a $103 billion acquisition offer. In spite of further pickup lines and courtship, Qualcomm continues to play hard to get. Essentially, it would rather have Broadcom as a friend and says it isn’t looking for anything serious. Further, Qualcomm has told its friends (i.e shareholders) it deserves better (more money) and has asked the U.S. government to step in for a national security review. Think about that time you used studying for finals to get out of a bad date. Same thing here. Unfortunately for Qualcomm, Broadcom anticipated all of this. It brought its A game. The company has since promised to repatriate its headquarters from Singapore to San Jose, pledge $1.5 billion to fund U.S. cellular innovation against Chinese competitors (there go the national security concerns), and has offered a higher acquisition price than ever before. Winning over the US government and friends alike, Broadcom has dodged every excuse thrown its way. The final acquisition figure is anybody’s guess, but Broadcom is going to close. It won’t take no for an answer.
So, why should you care? Well, since the early 1980s, Qualcomm and its founders have donated nearly $400 million to UCSD. Moreover, our cutting-edge Qualcomm Institute currently supports more than 350 faculty members, nearly 120 technical and professional staff, as well as hundreds of students and researchers. Outside of these incredible investments, Qualcomm has always been a major employer of our students and maintains a rich tradition of working with professional clubs for recruiting new-age talent. Thus with Qualcomm, we have unprecedented access to jobs and funding. As Rady School of Management’s Professor Harold Buchanan said, “There is no organization more important to UCSD than Qualcomm.”
Here comes the tricky part. Broadcom is very effective at streamlining costs and has developed a real knack for it. With this in mind, financial analysts think Broadcom would likely cut jobs and spending at Qualcomm in an effort to rein in costs and curb poor performance. This potentially means fewer job opportunities at Qualcomm for UCSD students as Broadcom leans out our neighbor. Further, when Broadcom does make the move to the U.S., it will likely shift its attention and philanthropy efforts on UC Irvine. The two have had a relationship in the past and UCI will likely try to hook up with Broadcom again in the future. Thus, we stand to lose both past levels of job opportunities and generous donations of our longtime partner Qualcomm. Put another way, there goes the neighborhood.
However, rather than roll back its presence in the community and specifically on campus, Broadcom should ride our electrifying current and invest more, not less, in UCSD. With Qualcomm’s infrastructure and network already in place, Broadcom should instead take advantage of all UCSD has to offer. We are inventing the digital future with our advancements in 5G, pioneering data science with the new Halicioğlu Institute, founding the country’s first virtual reality lab — the list goes on and on. Further, in direct competition with UCI, UCSD’s engineering divisions continue to best theirs year after year, thus investments toward UCSD will continue to serve a better return. UCSD also takes full advantage of its prime location, working with the top research institutes in the world and pushing its students into a hub of more than 8,000 tech companies. In short, it’s happening here, not at UCI. We have incredible resources of our own and all around us. We have the next generation research and development. We have the qualified interns, engineers, and future leaders. Broadcom should fish where the fish are and invest in UCSD. Our relationship would be a match made in heaven and would help spark a new age of progress.
To sum up, Broadcom will likely anchor in San Jose and reel in our friendly neighborhood Qualcomm. Upon acquiring, Broadcom should take full advantage of Qualcomm’s pre-existing relationship with our university, and then some, rather than scale back and shift to UCI developments. Our students are hooked on engineering. We’re the leaders in the next era of technology. And, as our past shows, we’re always eager to ride the first waves of innovation.
Surf’s up, Broadcom. We’re ready if you are.