Bluetooth is an emerging technology that lets cell phones, notebooks and other devices create wireless networks that can then link to the Web. Broadcom hopes that its chip, the BCM2002, will bring the cost low enough that cell phone makers can add the technology to more phones.
Qualcomm makes chipsets based on CDMA wireless technology and licenses those chip designs to cell phone makers to use in their own phones. Qualcomm is working with several other phone makers, including Ericsson, to come up with chips that meet its Bluetooth specifications.
Broadcom's 2002 chip is a radio transceiver that makes a phone Bluetooth-capable when added to Qualcomm's existing set of chips. A transceiver converts digital data from a phone into an analog format so the data can be sent. It also changes analog data it receives into digitized data.
Broadcom and other chipmakers aim to make chips that bring the total cost of Bluetooth technology to less than $5 per phone, a price that the industry considers low enough to make the technology widely available.
But industry analysts acknowledge that the technology needs to jump over some economic and technology hurdles before it becomes widely used.
"The handset makers have been under pressure to keep their costs down," said senior analyst Allen Nogee of Cahners In-Stat Group. "Even if you can sell Bluetooth for $5 you still need a compelling reason to add it" to each phone, he said.
Nogee also points out that the mobile phone makers such as Motorola, Nokia and Ericsson are experiencing tough times and will probably want to focus on selling more basic, lower-end models until conditions improve and the market is ready to accept the more snazzy Bluetooth-enabled phones.
Adoption of the technology on the consumer end has also been slowed because Bluetooth connection points must be installed in shopping centers, airports, businesses and other public places to give people a reason to buy the devices that will connect them to a network, according to analysts.
Bluetooth has some competition as well. Some chip industry observers say that a rival standard, 802.11a, may eclipse Bluetooth.