New Drone Investing Opportunity

Written By Brian Hicks

Posted September 14, 2015

As long as Tech Investing Daily has been a publication, we’ve been talking about the massive investment potential of unmanned drones.

Jobs that used to require a helicopter, pilot, and heaps of fuel can be done with small, unmanned drones at a fraction of the cost. They’re opening the door to air commerce for everyone.

Industries of all types are finding new ways to work drones into business. Big retail companies like Amazon have been toying with drones as delivery vehicles. Companies like Textron Inc. (NYSE: TXT) and Boeing Co. (NYSE: BA) are working on drones for the agricultural sector. Weapons and security companies have even developed weaponized drones for private use.

They are being employed everywhere.

The problem up until now has been that there are just too few public “drone companies” to invest in. We’ve covered all of them, believe me. We’ve also covered pretty much every other company providing drone components, be they hardware or software.

Now there’s a new entrant in the drone space, and it’s a welcome one: semiconductor company Qualcomm (NASDAQ: QCOM).

Qualcomm has become a major force in the smartphone and tablet space with its Snapdragon system-on-a-chip.  As the first company to provide a Gigahertz-speed smartphone processor, Qualcomm had its foot in the door during the rise of smartphones and now claims nearly 50% of the smartphone processor market.

The company is hoping to pull the same trick, but in the drone market.

Last week, the company unveiled its Snapdragon Flight platform, which is basically a system-on-a-chip for drones. Flight is based around the quad-core Snapdragon 801 processor that currently powers smartphones like the Samsung Galaxy S5 and the HTC One M8, but it includes a salvo of powerful features specifically for the unmanned drone.

Drone-specific features of the platform include 5 GHz global navigation satellite system (GNSS) for high-resolution navigation, real-time flight controls, 4K video support or stereoscopic video, and inertial and barometric sensors, as well as ports for additional sensors.

With this platform announcement, Qualcomm also made its first partnership announcement. Chinese electric aircraft company Yuneec International says it will have a drone based on the Qualcomm Flight board in 2016.

Qualcomm said it expects the first drones based on this platform to hit the market in the first half of 2016, but it did not specify if Yuneec’s would be the first.

Qualcomm’s entry into the space is important because it is attempting to commodify functionality that has only been available in the most expensive drones. By scaling up manufacturing, it can scale down the cost of adding sophisticated computing power for drone manufacturers.

In short, companies making lower-end drones that are more like toys than powerful aviation equipment could see a massive jump in the capabilities their drones can offer.

Good Investing,

  Tim Conneally Sig

Tim Conneally

follow basic @TimConneally on Twitter

For the last seven years, Tim Conneally has covered the world of mobile and wireless technology, enterprise software, network hardware, and next generation consumer technology. Tim has previously written for long-running software news outlet Betanews and for financial media powerhouse Forbes.

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