1 Thing You Need to Know About Broadcom Corporation's Competitive Positioning

I remember sitting through the webcast of Broadcom's analyst day in early December and hearing about how Broadcom believes that its Wi-Fi solutions are superior to its competitors'. The company even displayed a couple of charts showing just how much better its Wi-Fi chips performed relative to an unnamed competitor's comparable Wi-Fi chip.

However, I had always been curious as to how the best Wi-Fi chips from Qualcomm -- which has been rapidly gaining Wi-Fi share in the low end and mid-range of the smartphone market -- compared with Broadcom's finest. Claims from Broadcom's management are nice and all, but independent performance tests are better.

Thankfully, AnandTech delivered on the goods in its Samsung Galaxy Note 4 review, helping investors form a clearer picture of the competitive landscape between these two chip giants.

A three-way showdownAnandTech's Joshua Ho ran Wi-Fi performance tests of various devices, including the Samsung Galaxy Note 4, Galaxy S5 (T-Mobile), and the Galaxy S5 Broadband LTE-A. According to the review, the vanilla S5 features a Broadcom BCM4354, the S5 Broadband LTE-A features a Qualcomm QCA6174, and the Note 4 features Broadcom's BCM4358.

In the Wi-Fi performance test that Ho performed, the S5 Broadband LTE-A was able to deliver 422.0 Mbps in data transfer rates, the standard S5 delivered 436.0 Mbps, and the Note 4 achieved 471.0 Mbps in transfer rates. The Qualcomm solution is the slowest, and the two Broadcom solutions take the lead.

These tests show Broadcom is delivering on its claims that its mobile Wi-Fi solutions are the highest performing.

Some additional thoughts on these testsInterestingly enough, although Broadcom has a clear lead, the Qualcomm solution is far from a slouch: It's 3.2% slower than the BCM4354 and about 10.4% slower than the BCM4358 in those tests, so both of Broadcom's solutions appear to perform better than the Qualcomm solution.

However, the big weakness in relying solely on AnandTech's performance tests would be that these seem to represent near-ideal situations. If you recall from this Fool.com article published on Dec. 22, Broadcom's Dan Marotta, who leads the company's Broadband and Connectivity business, talked about Broadcom's ability to deliver chips that deliver high performance in "a difficult radio environment."

Unfortunately, it doesn't seem that the hardware review sites are all that interested in doing in-depth Wi-Fi performance tests, so it's very difficult for us outsiders to get more detailed performance numbers. The device vendors almost certainly extensively test all potential Wi-Fi solutions, so the ubiquity of Broadcom's solutions at the high end of the market does serve to validate Broadcom's claims.

Broadcom's competitive positioning looks good, but not invulnerableAlthough the Qualcomm solution tested quite well in the AnandTech review, which bodes well for Qualcomm's continued march in the low end, mid-range, and even in the high end, Broadcom looks solidly positioned as the top high-end mobile Wi-Fi vendor.

It's important to note that Qualcomm has the key business advantage of being able to offer the entire platform to OEMs in a tidy bundle. In fact, I would argue that Qualcomm uses Wi-Fi chips in order to sell Snapdragon applications processor and baseband platform.

Broadcom's mobile business, however, depends mostly onselling connectivity combo chips into relatively high-end phones/tablets. Staying ahead on the technology side will be critical for Broadcom, particularly as Qualcomm is able to throw in a Wi-Fi chip relatively cheaply alongside the rest of the platform; Broadcom has no such luxury.

The article 1 Thing You Need to Know About Broadcom Corporation's Competitive Positioning originally appeared on Fool.com.

Ashraf Eassa owns shares of Qualcomm. The Motley Fool recommends Apple. The Motley Fool owns shares of Apple and Qualcomm. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.