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Technology Stocks : Qualcomm Moderated Thread - please read rules before posting

QCOM 176.32

+2.0%

3:59 PM EST

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To: 100cfm who wrote (48405)	11/4/2005 10:17:19 AM
From: Art Bechhoefer	of 197081

But he said Qualcomm, which owns key patents for a high-speed wireless standard known as W-CDMA, made certain commitments by making its patents part of the standard. "When you become part of a standard you make a commitment to price on fair, reasonable and non-discriminatory terms," McGregor said. The issue here reminds me of the time that Unocal (now part of Chevron) convinced the state of California to adopt standards for reformulated, low pollution gasoline that would make use of patents that were eventually approved for Unocal's process for making reformulated gasoline. A lot of companies, including Exon Mobil raised a big stink about Unocal's tactics. The case went up to the Supreme Court, and Unocal prevailed. Unocal made agreements with several refiners, allowing them to use its process, but these agreements were not uniform. Unocal simply charged what the market would bear. I don't see any legal reason why QCOM must be committed to any set formula for the use of its patents. There is no valid argument here for predatory or discriminatory pricing. The fact that so many individual companies agreed to the licensing and royalty terms argues strongly against the notion of discrimination. The issue before the European court does not resemble the Microsoft issue at all, where one could argue that the Windows operating system had for all practical purposes no competition, and more important, no licensed suppliers apart from Microsoft. The whole issue probably will be resolved long before it gets to trial, simply because the service providers need equipment that contains QCOM IP. The only question is who will supply the equipment, the gang of six, or some other competitors that could make life even tougher for the gang of six. Art

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