re: Hersch and Jane say Telecoms Recession Over
... and I hope they are correct.
<< BTW I personally find Qualcomm the only "sure thing" (just joking of course) among the young "existing" gorillas. >>
LOL! We both know there are no sure things. The Twin Towers (no longer) stand in testimony to that.
If this dynamic duo is correct (they aren't always) ... then Qualcomm has a better chance for growth on the short haul, then they otherwise will. The estimation of growth 10% to 25% for next year is a pretty wide spread. We all would like to see it to the high side.
One of many great Qualcomm mysteries is how much they get paid on infra, and what constitutes infra. Nevertheless, next year could mark the commencement of decent royalty based infra revenue from WCDMA.
There is not a lot of WCDMA infra shippingy et, but WCDMA infra is shipping to a LOT of carriers, and revenue recognition will take place mid next year, and could start dramatic growth by the end of year. That revenue will contribute to ramp once it gets started, and it will be sizeable.
>> Telecoms Recession Over - Report
Cellular news
November 14, 2002
A new report from The Shosteck Group has said that the telecoms industry has bottomed out and will start to recover in the first quarter of next year. "A global economic slowdown has taken hold but the situation will turn around," states Jane Zweig, Chief Executive Officer of The Shosteck Group. "However, this does not mean that things will go back to the way they were prior to the slowdown. Companies who were at the top prior to this slowdown may no longer be there. After the recovery, this opens opportunities for innovative companies who will fill many of the gaps left by the majors. Additionally, the rules which governed the market prior to the slowdown may no longer apply," she continued.
The study points out that despite the excess infrastructure spending of the past two years, the increase in telecommunications subscribers and use - both landline and mobile -- continues. These increases will force network operators to resume construction. "From the First Quarter of 2002, vendors of telecommunications equipment can expect increasing revenues. This will be especially the case for the wireless segments. Based on our analysis of six case study vendors, we anticipate that during 2002, industry sales will recover by 4.5% to 11.2% above those of 2001. During 2003, they will expand to approximately 10% above those of 2002."
"During 2001 mobile networks likely added the same number of subscribers as in 2000, and possibly more. Yet, sales of mobile equipment have declined, albeit not as much as sales of non-mobile equipment. This presents a paradox, "commented Dr. Shosteck. "How can mobile network operators serve subscribers who are increasing in numbers to the same extent or more than the year before, without purchasing an equal amount of equipment? While subscribers and network traffic are increasing, operator investment in network capacity is not keeping pace. Under these circumstances, operators are quickly using up any slack in network capacity. This points to an impending and unavoidable capacity crisis," he continued.
The Shosteck Group concludes that during Q1 2002, new orders from mobile operators may be "abrupt and substantial." However, firms all along the value chain have reduced their inventories to bare minimums. This is constraining the extent to which vendors of mobile equipment can expand production. Should orders spurt, vendors may not have sufficient inventories to meet the demand. Those vendors that act now to secure a sufficient supply of components will gain competitive advantage. <<
- Eric - |
