3. QUALCOMM WIRELESS INTERNET STRATEGY GOOD FOR GLOBALSTAR
COMMENT: Last week, we reported on Qualcomm, Inc.'s (QCOM, $363) new High
Data Rate (HDR) technology capable of supplying reliable and
cost-effective high-speed wireless Internet access. With the market
taking notice of the potential impact of HDR, Qualcomm's stock has soared
over the past two weeks. Naturally, the question arose as to how HDR
might affect Globalstar Telecommunications (GSTRF, $28), of which Qualcomm
is the 17% owner. Essentially, Globalstar reports that the HDR technology
is not presently compatible with its system but should be soon. With
limited bandwidth on a satellite, HDR would compete with voice service and
likely be priced the same. All in all, HDR represents a potential upside
for Globalstar as it may provide more reasons to use the Globalstar
service and may increase the per minute usage per customer.
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4. BARRON'S THINKS THAT GLOBALSTAR MAY SUCCEED
Taking a contrarian view from much of the business media, Barron's reports
that Globalstar Telecommunications may actually succeed in establishing a
mobile satellite system where Iridium and ICO Global Communications
(ICOFQ) have so far failed. Barron's notes that Globalstar also has the
advantage of learning from Iridium's blunders, which include poor
marketing and technical glitches.
COMMENT: Nothing we haven't said all along. Often, it's the second mouse
that gets the cheese.
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5. EMAIL BY PHONE IS THE NEW STANDARD IN JAPAN
Demand for mobile data services for e-mail or Internet access is soaring
in Japan, reports the Financial Times. When a double-income Tokyo couple
needs to communicate with each other during their busy working hours, they
don't pick up the telephone; instead, they send each other e-mails on
their mobile phones. The Financial Times further reports that a surge in
mobile data services is transforming the industry. Without data services,
mobile phone operators can no longer hope to compete in Japan. Although
launched only nine months ago, mobile e-mail services has seen such strong
demand that NTT Docomo, Japan's largest mobile phone operator, expects to
sign on 4 million users by the end of March, compared with an initial
estimate of up to 3 million. Within the next few years, Docomo expects 30
per cent of mobile phone users to be using data communications. According
to a Docomo official, there are nearly 50 million users of mobile phones
in Japan, compared with just 14 million users of the Internet on PCs.
COMMENT: As a communications tool, mobile phones already have far more
potential than personal computers. Japan (and Europe) is far ahead of the
United States in use of cellular technology. Since we expect the trends
for data over mobile devices to also play out in the rest of the world, we
expect to see the Wireless Investor's Portfolio continue to perform well. |
