Bux - forecasting the 3G situation is almost impossible. The timetable, how fast it's implemented, what are the exact licensing fees to different parties, etc. The more a company has riding on third generation, the riskier it is. Right now, markets don't care. People are gluttons for risk, as long as there's a big upside. If you think this psychology will continue indefinitely - fine. Buy some QCOM calls at these prices and tell me later how it went. But stop acting like the whole mobile investing world revolves around this company.
You are talking about how Qualcomm's market cap is still tiny relative to Nokia - and forgetting a small, but important factor. Nokia actually has sales. And it has those sales in most major markets, not just USA and Korea. Everyone is talking about 50-100 kbps data speeds for mobile networks. Nokia has signed up a dozen operators to buy that speed from Nokia. Compare that number to other mobile network companies and figure out who's delivering the 2.5G solutions and who's just making press releases about them.
This three-fold consumer product/core second-generation network/mobile data upgrade position is what can be leveraged to a solid performance in the 3G market. That's why Nokia became a key partner for Japan's, Korea's and China's leading 3G research programs. It doesn't mean that turning this position into profits is going to be easy - or even likely. But it's something. It'a a leg to stand on, maybe even two.
Qualcomm is becoming more and more reliant on the IPR income. You can argue that this is enough - that they can set up a box office and just ask companies to mail in the checks. But you can't argue that the profit outlook for the next five years is crystal clear. It's all up in the air. How do you think Qualcomm will muscle in on the W-CDMA market after opposing W-CDMA for all these years? How do they start selling components to key W-CDMA manufacturers, when the company has been excluded from all key W-CDMA collaborations? You think that NTT-Docomo, Korea's operators or China Telecom have a lot of warm feelings towards Q? These are the companies who call the 3G shots in 2001. Funnily enough, they don't seem to talk about Qualcomm and third generation in same sentences. If you want to bet that NEC and Matsushita will buy their chipsets from Q - be my guest. But that's pure faith. It has nothing to do with evaluating what is most likely to happen.
W-CDMA may roll out in Japan during the spring of 2001, and then in Europe during the spring of 2002. Where exactly does Qualcomm fit in all this with their emphasis on cdma2000? Those digs on my Finnish nationality are just tired, cheap shots. I haven't seen any criticism leveled on those California commentators urging people to buy Globalstar. You think regional bias is worrying? How do you judge the US analysts who missed the mobile phone revolution, because pagers are still big in Topeka?
You picked a fine moment to show up, Maurice... as usual. I tried to case out the Globalstar stand at Geneve, but I didn't see anyone with a stetson. We have to take the hats to New Orleans in March, I guess.
Tero |
