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CEOs should not give commencement addresses

My commencement speaker was Daniel Goldin, the outgoing head of NASA. I guess they wanted to connect with the whole "2001" theme and have a spacey speaker, but Goldin is an administrator, not an innovator, and I was bored to tears. It could have been worse: MIT and Stanford graduating classes have both had Carly Fiorina as a speaker, and someone from the MIT class of '05 just sent me the text of the commencement speak by Irwin Jacobs, CEO of Qualcomm, which is the epitome of boring CEO commencement addresses. Read on, if you like being bored.

Commencement address by Irwin M. Jacobs, CEO of Qualcomm
MIT Commencement, June 3, 2005
June 3, 2005


Thank you very much. It's a great honor to be here with you on this very special
occasion, and I would like to give special thanks to President Susan Hockfield
for asking me to provide this address. I'd also like to congratulate the Class
of 2005 on this very special day, and provide welcome to the family and friends
of the graduates, to the faculty here, to the entire MIT family. It really
indeed is a very special time.

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, Massachusetts, 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, California--and
so as I toured around, looking at all the equipment, seeing analog and digital,
differential analyzers, up to cellphones (which are of course are 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. Aand 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 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 cellphones 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 cellphone 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 cellphone, 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 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.

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