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Tuesday, July 05, 2005 | (From his June 3 commencement address at the Massachusetts Institute of Technology)
Walter Munk of Scripps Institution of Oceanography has been a legend among his peers for a couple of generations now. Yet, he and his wife, Judith, continue to innovate and astonish both town and gown as the hot link with new minds. Over dinner at the Munk home more than 25 years ago, I met a physicist from MIT who had been recruited to the University of California, San Diego faculty. And it now seems equally predictable that the physicist, Irwin Jacobs, was talking that evening about an idea and a start-up company that seemed to be attracting little attention and too few investors. It was Linkabit.
Linkabit was a good idea. But Jacobs’ next one, which we understood then only as a new method of telephony, became legend: Qualcomm. It remains the foremost example of the evolution of the high-tech San Diego set off by the arrival of UCSD. Jacobs has learned to enjoy his success, and he seems less wary these days of talking about it. The most extensive narrative to come from Jacobs himself has just been delivered as a commencement address. Voice of San Diego asked Jacobs to allow us to share the address, which follows:
“It’s a very great day to graduate. I remember back to receiving my graduate degrees here, a master’s and a doctorate, back in ’57 and ’59, quite a few years ago, fitting very well in with the 50-year reunion class. I must say that, at that time, I could not possibly have imagined all the things that were going to happen in my life over the succeeding years. That indeed is something I’d like to pick as the theme today, namely that we’re all going to, and in particular, you are going to be going through a great deal of change, providing both opportunities and occasionally some problems. But, in fact, an MIT education is about the best possible way to prepare yourselves for this very exciting future. I suspect again that a few years from now, when you have the opportunity to think back, there will be many things that you just could not have anticipated, and so it’s important to be prepared for those changes.
“My life itself has seen a number of changes. I’ll use those for an example. I actually was born in New Bedford, Mass., not too far from here. When I graduated high school, I had always been interested in math and chemistry, physics. My high school counselor advised me, and this was 1950, that there was no future in science, nor in engineering. And since I didn’t really have a measure to evaluate that, I then took his advice. My family had a small restaurant, and so I entered the school of hotel administration at Cornell University.
“Well, I had an engineer as a roommate, and after a year and a half of hearing him talk about how tough it was to get those grades if you were in engineering, and knowing that I really preferred engineering, again, I made a very significant change in life and decided to transfer over to electrical engineering. And that was a very exciting period. I was a co-op student. That turned out to be very useful. One of the engineers I worked with then advised me to go on to graduate school, and that’s how I ended up at MIT. But thinking back, in my last term at Cornell – and this is how fast things have changed – I took a course in the theory and practice building of vacuum tubes, built a 6FN7 and a 686 – you’ve probably never even heard of these terms any longer.
“I was reminded last week, when I gave a talk at the Computer Museum in Mountain View – and that, in fact, has a lot of equipment that originally came from the computer museum here in Boston but now is out in Mountain View, Calif. – and so as I toured around, looking at all the equipment, seeing analog and digital, differential analyzers, up to cell phones (which are of course the latest and most powerful computers, but I’ll come back to that) that it was amazing to me how fast things have changed and, again, that’s the key issue with change. It is amazing to see all these familiar items that had been in my life and then passed out of it so quickly. Well, I did decide to apply and luckily was accepted here at MIT to graduate school, and originally came thinking that EM theory, electromagnetic theory, would be an interesting area, but at MIT at that time, Professor Claude Shannon had just come, the father of information theory. There was a lot of interest in the theory, the mathematics, probability theory, etc. And so I decided that would be my future. And I’m very pleased with that decision.
“One of the early courses I took was from Professor Norbert Wiener. I don’t think probably anyone here might have had the opportunity, but it was very interesting. There were many tales, I’m sure, still running around MIT about Professor Wiener. One that I most remember, in taking this class, probably like several of the classes you might have taken, the lectures were, well, I probably shouldn’t say this – it’s not the case any more – but the lectures were incomprehensible. And so, each night, a group of graduate students would get together and try to figure out what it was we had heard during the day, and try to put it together in a way that we could understand. About halfway through the term, Professor Wiener heard that we were doing this, came to the room, and said, “Can I look at the material?” Became interested, said we should make a book from this. And so we then continued to put the material together as a book. He would come in, every day after class, and his only question was, “How many pages are we up to?” So he always had a different slant on things. That book did come out. It’s “Nonlinear Problems and Random Theory,” the first book that I was ever involved with. Went on the faculty here, again, it’s a wonderful way – if some of you are considering careers in teaching – I’d greatly recommend it. It’s the best way to learn material.
“And while here, I decided with Professor Jack Wozencraft to put together a book, a textbook for a senior-level communications course on applying what was then brand-new digital theory and information theory. I tried to give it a little bit more of a practical face, and there were many at the time who said there really is no practical use for this, you should just treat it as applied mathematics. In fact, of course, that’s turned out not to be the case at all.
“I did take a leave of absence to make my one visit to California, about the time we were finishing the book in ’64-’65. We decided that might be a good place to retire sometime, came back to Boston, had a call from a professor from Cornell saying that he’s going out to start a brand-new department of electrical engineering at a brand-new university in San Diego. Would we join him? First reaction, of course, was no. Family, friends, career here. But after a couple of days we decided that California and a brand-new university and an opportunity for a different experience might be quite exciting in our lives, and we accepted. Again, change, the change from here to a brand-new school, it was interesting. And the brand-new school was very small, of course, very few faculty. One of the classes I started had to do with introduction to computer science. There were some engineering students, but there were students and faculty from music and from the arts departments, and kind of, in interacting with them, developing an even greater love for the arts and music that we’ve been able to follow them ever since. So it was very interesting being in a brand-new university.
“But that also led to another major change in my life. Because of the MIT background, a lot of industry in Southern California, there were many requests for consulting. Typically, if you’re on the faculty, you might consult a day a week, and so I mentioned that to a couple of friends on the faculty of UCLA (we were flying back on a trip) and they said, let’s start a company and share consulting. And I said, fine, as long as I don’t have to get involved with managing it, and so we started a first company called Linkabit. And, very quickly, it began to grow. And so I did then decide to take a year off and check out business, try to get things properly organized. Didn’t know really a thing about it. Luckily, in the hotel school, I had had a course in accounting, a course in business law, so a little bit of background. It turned out to be very useful, but I really had to learn the business side of things. Engineering is by far the best preparation for just about any field, so that has indeed worked out very well.
“So Linkabit, this first company, did grow very nicely. We got involved in a number of interesting programs. One, scrambling TV signals from satellite to home, that’s turned into a very major business. Another, what I call a very small one, Aperture Earth Terminals, where if you put a credit card in at a gas station, often it will go over one of these satellite terminals.
“We’ve been into the cellular phone business since early on. And, actually, a processor, we didn’t know the name at the time – I don’t think it was really out – but a reduced instruction set processor, RIS processor, that we built into a terminal for use in government programs, and, in particular, for a program here at Lincoln Laboratory, to communicate with what was then called the Less 89 satellite. So, again, things tied back together very nicely. Very exciting to be able to come up with ideas, be able to apply theory to things that were rather practical, rather useful.
“Well, we made the mistake, in a sense, of selling that company, and in 1985 I retired. Retirement was a terrible thing, so I lasted about three months, and then started Qualcomm. And I more or less assured my wife that if things went very well we might have 100 employees at some time. But then, we’re now over 8,000 employees. And by the way, in my welcoming, I also meant to welcome any Qualcomm shareholders who might be here today.
“Well, we didn’t have any products. Luckily, we didn’t have to go out for venture capital, so we didn’t have to have a business plan. But we knew digital, we knew wireless would be very exciting, and it turned out that it was on a drive down from a consulting contract meeting in Los Angeles, a drive down to San Diego, about halfway, luckily, it’s 110 miles or so, about halfway down, realized that something called co-division multiple acts (CDMA) would be very useful for mobile communications. Well, the company was very small. We had to wait a few years before we could go ahead and develop that idea, but the time came when we sold our first product, had a little bit of a cash flow and were able to then go back and pay attention to that, actually at the end of 1988. Began to take a look at it. Well, if any of you decide to go into your own businesses, and some of you, I’m sure, will be doing that, you run across a time when you have to make a company decision. And so, CDMA was one of those.
“Should you put a lot of money into R&D in a technology that may or may not be accepted? Is the world going off in a different direction? And, luckily at that time, I had not heard one of the projections that had been made to AT&T by a consultant two years earlier, or a few years earlier, that if all went well, there would be a million cellphones in use by the year 2000. Actually, they missed by a little bit. It was 600 million. And that, of course, gave a great opportunity for moving ahead with CDMA. We did develop the technology, demonstrate it, because otherwise everything sounds too complicated. You have to have demonstrations, so that was again one of the bet-your-company-type issues. And then the question comes up, if you now have a good product, how do you build a business model? What do you do about that? And so again this is the type of concern that you may be having going forward. We decided to go into a mode which was both licensing and of selling, initially, phones and infrastructure to get things started, but ultimately the chips. And that works out very well. As you know, chips keep getting more and more powerful. You can put more and more capability in them. If you come up with innovative ideas, you can build those into the chips. And so that’s exactly the path that we followed.
“It’s interesting that, today, there are probably about one and a half billion users of cell phones around the world. In 2005, there were over 600 million sold, in the one year, or will be by the end of the year. Comparing that to about 150 million desktop and laptop computers, it’s quite clear that the future is not in plastics, but really, now, in mobile devices. And the interesting aspect is that the capabilities keep going up. One of the things that is now being provided is called third generation; again, I won’t go into details, but if some of you have been using not just the wireless that’s available on campus, that’s called 80211, but a wide area coverage provided right now by Verizon here, one can get a very high data rate anywhere that you can receive a cell phone call, and so that is a key step.
“But the interesting part is the devices, and because of Moore’s law, the number of transistors on a chip, doubling roughly every two years or so, power going down, cost going down, all the right things happening, there’s been a major transformation. When we first built our first cell phone, it took three chips to implement the communications only. Now it takes about 20 percent of one chip. What do you do with the other 80 percent? You can put a lot of computing power. In fact, now we’re going to two processes, one of which is moving toward a gigahertz-type processing speed. Two processes, a couple of single processing units, a 3-D graphics capability, GPS receiving. You can put a lot on that chip, make it available as a low cost, high reliability, and therefore very useful to people. Therefore, since it’s a computer now – not really a phone, you may not realize it when you’re carrying it around – a very powerful computer, it opens up many possibilities.
“And so we’ve developed another approach we call GRU (in fact, there’s a conference now with about 2,400 people at it, occurring in San Diego), where developers anywhere in the world can develop an application to be downloaded to the phone. We arrange to provide a digital signature, a tested digital signature, so it won’t corrupt the phone, and therefore, they can develop these, bring them, via some Internet meeting grounds we’ve established with the operators, bring their applications to the attention of operators around the world, and bill the business. And I think at this last meeting that’s ongoing, it was mentioned that there was about $350 million that had been funneled from operators to Qualcomm and then Qualcomm back to the developers around the world, and these last six months on the order of 150 million. So it’s providing a very interesting base for people to start new companies, be able to market relatively inexpensively, have a very large market, and, very quickly, get back an income. My own feeling is that over time, we’re all going to have to carry around one device, never want to get too far away from your phone, but that device, in fact, is going to be doing many things. We’re all used to the fact that now cameras become megapixel cameras, because you can put more capability on the chips. They’re becoming video cameras, actually will be approaching DVD-type quality very quickly.
“The more exciting aspect is other things, I think, that we’re going to be able to do with that. We’ve all heard of issues with the digital divide, access to communications, to the Internet being more limited in certain regions. I think that the phone is a low-cost device with a huge amount of computing power and connection to the Internet, an ability to download software, process it, a large amount of memory by the way. With the appropriate amount of thinking and planning, it can be used to supplement teaching in many remote areas, as well as, of course, developed areas, around the world. So I think that there’s a great possibility there to move ahead with these devices. People are still just realizing what the power in the devices might be, and, again, hopefully some of you out there will find this challenging. Of course, there are also medical devices that are now being attached to the cellphone, measuring blood capabilities and moving toward e-government. We’re finding support, voting, information, etc., by use of the cellphone. So again, a device that we think of as a phone is a very powerful computer opening lots of opportunities.
“Well, I mentioned e-government. One of the things I would like to recommend to all of you, or at least some of you, is to consider a career in politics. Again, I think an MIT education prepares you for just about anything. And it’s interesting. I was over, a couple of years ago, with the previous president of China. We had a meeting. They always have this very formal U, myself and the president were sitting at the head of the U, and then staff on either side. And there’s a little bit of chitchat that occurs before the formal meeting. What do you think the first question that was raised by the president of China, sitting next to me? How many more generations did I think Moore’s Law had to run? The president of China! Discussing it with him a little further, it turned out he actually was trained as an engineer, as a radio engineer, as was the prime minister of the time. That’s the kind of interest and ability to, again, think about technology, bring it to use, that I think is also very important here in this country, and, of course, there’s very little of that available here.
“Another aspect, when I came to be a student here, I was lucky to benefit from the research laboratory of electronics, but it was very well-funded at the time. Now the funding has been cut back quite a bit. There really are reasons to get out and become very politically active.
“Well, there have been many rewards from having this type of an education, being able to go out. The world is changing; one can take advantage of those changes and do very well. It’s important, of course, to have an impact back and the opportunity for philanthropy, of course, never goes away. We have been very lucky; our focus often is on education, but also cultural activities, other activities around the world, and I think that as you begin to move ahead in your careers that you should definitely pay attention to.
“So, I’d like to finish by again congratulating you. You are embarking on a great adventure. You’re probably entering a period where there’s even greater change, greater things happening around the world than was correct when I graduated here. You might have seen a statement back from 1899 where the head of the patent office said that everything that can be invented had been invented, clearly another shortsighted statement. But if you check with the patent office now, you’ll find that many of the applications, many of the patents in the U.S. patent office are coming from overseas. And so, again, the competition is heightened, we have to move ahead, we have to improve our education throughout. We have to remain very innovative. You can certainly be guaranteed that there will be those changes. You have been well prepared. I wish you as much fun and excitement as I have had along the way.”
Irwin M. Jacobs is the founder of Qualcomm Incorporated. He recently stepped down as CEO and currently serves as chairman of the board.