Qualcomm plans to spin off its business that manufactures semiconductors and software for cellular phones.

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The move will allow the new company, presently referred to as Qualcomm Spinco, to design and develop cell phone chips that can operate using both Qualcomm's technology and those of competitors.

In the meantime, a streamlined Qualcomm will be able to focus on further development of its cell phone technology, including applications for wireless Internet access.

Qualcomm plans to sell 10% of the new company in a public offering. The remainder of shares will be divided among existing Qualcomm shareholders.

The spin off, subject to approval by federal regulators on Qualcomm's board, is expected to be completed by August 2001.