Qualcomm is adding WiFi positioning to its suite of chip-level location technologies, announcing today it will compliment its GPS and cellular triangulation technologies with Skyhook Wireless’ software platform.

“Qualcomm has licensed our technology and will bake it into their gpsOne chips,” said Ted Morgan, chief executive officer of Skyhook. Skyhook has created a comprehensive database of the physical locations of WiFi access throughout the US and Europe. WiFi-enabled devices loaded with Skyhook software can scan for WiFi access points—whether public or private—and, using their media access control (MAC) addresses, query the Skyhook database to obtain a location. As in cellular triangulation, the software measures the relative of strength of multiple WiFi signals to calculate precise coordinates, but even in the rare cases where only a single access point is available, Skyhook can register a location within a few hundred meters.

The service is particularly useful in denser areas and indoors where GPS has the most problems. In an urban canyon or inside a building, the GPS signal is too weak to give a precise reading, but it is precisely in those areas where hotspots abound, Morgan said.

Since Skyhook’s WiFi Positioning System (WPS) is entirely software-based, it can be incorporated into standalone applications on a WiFi enabled phone or laptop. The iPhone and iPod Touch, for instance, use Skyhook software for its mapping and location programs. But Skyhook is trying to push its software deeper into the device. OS developers such as Symbian have begun incorporating Skyhook technology directly into their platforms, but by moving down to the chip level, Skyhook can ensure WiFi location is available to any device with WiFi radio.

Broadcom signed a licensing deal with Skyhook in September to use WPS in its location-based services portfolio, but the Qualcomm deal is of particular significance due to its policy of making assisted GPS available in the majority of its CDMA and W-CDMA chipsets. Qualcomm already has 400 million gpsOne-embedded handsets in the market. That could mean big business for Skyhook as it collects its licensing fees by the device.

Of course, not every device will have both WiFi and GPS radios embedded, but the number is starting to grow. The WiFi Alliance said that 18 million dual-mode WiFi/cellular phones and converged devices were shipped in 2007, while it estimates that number will increase to 500 million by 2012.