The New Qualcomm - a S&P500 company Message Board

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Technology Stocks : The New Qualcomm - a S&P500 company

QCOM 166.05

+0.6%

Nov 19 3:59 PM EST

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To: Caxton Rhodes who wrote (3317)	11/16/1999 4:46:00 AM
From: Maurice Winn	Read Replies (1) of 13582

*What happens to Q! as minutes get cheap* Not so fast there Caxton. While Q! will make heaps more as the cost of cellphones and WWeb comes down to everyone's reach, there's a slight problem. Initially Q! makes vast riches as 4bn people each buy 2 or 3 devices and are served by others [such as Coke machines]. That works on the basis that it's better to get 5% from 1bn people buying something for $100 each, than 5% from 100m people buying something at $500 each. But what happens when the gadgets and infrastructure get REALLY cheap. When ASICs cost a dime and basestations $100 and the wholesale price of handsets reflects the low cost of the ASICs and the cheap plastic housings and a bit of solder and when methanol fuel cells are near free [if they are included in the wholesale price on which royalties are based]. 5% of not very much, [say $20] is still not very much even if we sell 5bn of them. Okay, $5bn is not a bad fee, but you get the point. Maybe we won't sell 5bn of them. Gee, it's still quite a bit of money. Then there's WK, Globalstar etc etc etc.... Okay, for the next few years, the cheaper they get, the more Q! makes. Of course the minutes only get cheap as the cost of providing the service gets cheap which depends on the cost of building those minute factories [or IP packet factories as the case may be]. Mqurice

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