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Qualcomm CEO: Cell Phone Will Replace the Wallet

Paul Jacobs, CEO of QUALCOMM, gestures as he speaks on QUALCOMM'S mobile multimedia technology during a news conference at the Cellular Communications and Internet Association convention in Las Vegas, Wednesday, April 5, 2006. (AP Photo/Jae C. Hong)
Jae C. Hong
Paul Jacobs, CEO of QUALCOMM, gestures as he speaks on QUALCOMM'S mobile multimedia technology during a news conference at the Cellular Communications and Internet Association convention in Las Vegas, Wednesday, April 5, 2006. (AP Photo/Jae C. Hong)

Paul Jacobs, Qualcomm’s chief executive officer, told CNBC’s “Morning Call” that he believes the cell phone morph itself into a payment device, eventually making your old-fashioned leather wallet obsolete.

Advertisers will be able to send customers coupons that are automatically redeemed when buying the item, Jacobs said. A cell phone also could be used to send money to kids at college as needed. “I think people will see their phone replace their wallet,” Jacobs said Thursday.

Also coming soon on your cell phone: 3-D gaming and improved navigation capabilities.

“The third generation of cell phones is growing,” Jacobs said. “There are over 460 million subscribers using third generation systems in the world today. We’re seeing continued growth in the number of handsets that are being shipped and also the kinds of services you can do over the phone.”

Qualcomm offers mobile TV in 27 markets and plans to expand the service quickly, Jacobs said.

Qualcomm said second-quarter profit rose 22% to 50 cents a share and revenue increased 21% to $2.22 billion from the year-ago quarter. Wall Street analysts expected the company to earn 48 cents a share.

While the company benefits from increased demand for advanced cell phones, its shares are off about 15% from their May 2006 high as investors fret about the company’s legal tangle with Nokia over a technology contract that expired this month.

“There’s not a lot of news to report,” Jacobs said. “We’ve filed an arbitration, the lawyers are doing their thing, and the process continues. Despite what people perceive as a distraction, the company has executed as demonstrated by what we did this quarter.”