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How Qualcomm’s New “Human Chip” Lets You Train Your Phone Like a Dog

For as long as they’ve been around, robots have walked the line between fascination and skepticism.

Many books, TV shows and films have depicted the positive, helpful side of robots. But they’ve also demonstrated the chaos and destruction that can ensue when they malfunction or turn evil.

With that in mind, in his 1942 science fiction story, Runaround, Isaac Asimov laid out a set of “rules for robots”…

  1. A robot may not injure a human being or, through inaction, allow a human to come to harm.
  2. A robot must obey orders given to it by humans, except where such orders would conflict with the First Law.
  3. A robot must protect its own existence, as long as it doesn’t conflict with the First or Second Laws.

In later editions, a “Zeroth Law” was introduced: A robot may not harm humanity, or, by inaction, allow humanity to come to harm.

How? Well, in Asimov’s sci-fi universe, robots had “brain-like” components that helped them understand these rules.

Fast forward to today… and Qualcomm (QCOM) is turning make-believe into reality.

Specifically, it just made that robotic brain!

Inspired by Asimov’s rules, the company has named its new processing chip “Zeroth.”

And just wait until you see what it can do for your smartphone…

Bringing the Power of the Human Brain to Technology

Despite the cast of Jersey Shore trying to prove otherwise, the human brain is one of the most powerful wonders of the world.

It’s infinitely more powerful and efficient than any traditional computer chip that exists.

Most people take comfort in that! But scientists and engineers see a challenge and strive to narrow that gap.

Like the ones at Qualcomm, for example.

They’ve developed a “biologically inspired” processor chip, modeled on the human brain. And the brain-like architecture within the chip is so powerful, it can even mimic nervous system processes.

I had a chance to speak with Qualcomm’s CTO, Matt Grob, at the recent EmTech Conference. He ran through Qualcomm’s progress in this field, how the technology is constructed, and where he sees it going…

Four Uses for Qualcomm’s Neuro Chips

Qualcomm is focusing on a class of processors called Neural Processing Units (NPUs).

In his presentation, Grob explained that NPUs are designed to be massively parallel, reprogrammable and capable of mimicking human functions like cognition and perception.

Here’s the fascinating part…

When you embed these NPUs into devices, it’s the equivalent of giving them human cognition.

And Qualcomm envisions using these “neuro-inspired” chips in…

  • Robots
  • Artificial vision sensors
  • Brain implants
  • Smartphones

Aside from the fact that these chips can make robots more “human” in their functionality and responses, the implications of this technology in the smartphone world are remarkable…

Why Your Phone Will Soon Be Like Your Dog

You’ve heard of the movie, How to Train Your Dragon. Well, how about “How to Train Your Smartphone”?

In Qualcomm’s eyes, the “smartphone of the future” can understand and carry out your commands.

Please note: We’re not talking about something like Siri here. That’s child’s play.

Qualcomm’s Zeroth chip allows you to actually train your phone like you’d train a new puppy. How so?

Well, the good news is that your smartphone will never urinate on the floor, or chew up the couch. But it will perform “bad” tasks from time to time. When it does, all you have to say is, “Bad phone!” – and it will learn from its mistake.

The opposite works, too…

If your phone works like it’s supposed to, you can give it praise – “Good phone!”

Underpinning this technology is a suite of sophisticated software tools that Qualcomm has developed, which can teach devices the difference between “good” and “bad” behavior without complex algorithmic programming.

Take a look at this video clip I took of Matt Grob presenting Qualcomm’s research. Through positive reinforcement, you’ll see a robot learning to avoid yellow tiles and only go to the white ones on the floor…

Qualcomm

It’s innovation like this that’s having a positive impact on Qualcomm shares…

How to Profit From Qualcomm’s Innovation

A quick scan of Qualcomm’s fundamentals reveals its strong position. For example…

~ Revenue and Earnings Growth: In the last quarter, Qualcomm boosted its year-over-year sales and earnings growth by 35% and 31%, respectively. That’s led to a robust 28% net profit margin – 11% higher than the industry average.

~ Earnings Per Share: Over the past two years, Qualcomm’s EPS has risen strongly. Through the first three quarters of 2013, its aggregate EPS of $3.05 is 9% higher than the same period in 2012. Analysts estimate total EPS of $4.45 in fiscal 2014.

~ Cash: Over the past year, Qualcomm’s net operating cash flow has jumped by 125%, outpacing overall industry cash flow growth of 88%. The company has $11.4 billion in the bank and little debt.

The only near-term negative is ParkerVision’s (PRKR) patent infringement lawsuit – one that sent PRKR shares soaring by 61% after a federal jury found Qualcomm guilty. ParkerVision is seeking $500 million in damages – a figure that could rise to $1.5 billion if Qualcomm is guilty of deliberate infringement.

Aside from that, Qualcomm’s consistent growth makes the shares attractive at current levels. And with products like the Zeroth chip and RF360 (its next-gen radio receiver/transmitter for cellphones) in the works, a rise to some analysts’ $80 target price on the stock would represent a 20% gain. On the options side, consider the QCOM November $70 calls.

Your eyes in the Pipeline,

Marty Biancuzzo

Marty Biancuzzo

, Technology Analyst

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