The New Qualcomm - write what you like thread. Message Board

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Pastimes : The New Qualcomm - write what you like thread.

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To: Maurice Winn who wrote (1292)	12/22/1999 11:20:00 PM
From: Jim Lurgio	Read Replies (1) of 12242

Maurice , Seems Gregg Powers didn't think handset division would go but it did. Pray tell why? There's more to this than meets the eye. What's your view ? Gregg is gone and don't comment so give us your view where this Bird will fly. To: w molloy who wrote (27141) From: Gregg Powers Thursday, Apr 15, 1999 12:35 PM ET Reply # of 56201 Sell the handset division? Pray tell, why should the company do that? Hopefully not because some (still) misinformed analysts would prefer simpler spreadsheets! I presume you realize that Qualcomm has a substantial embedded margin advantage in handsets? You recognize, of course, that the company does not have to 'pay itself' royalties? On top of this, everybody else is either buying ASICs from Qualcomm (the margin on which QC again does not have to 'pay itself') or is spending a fortune (on a fully allocated, unit cost, basis) to develop their own chip. Given these dynamics, QC should have an embedded margin advantage somewhere between 500 and 700 basis points....which is roughly twice the operating margin achieved by MOT its entirety last quarter. After some annoying fits and starts, the team of Jacobs and Dollard seem to be making lots of progress. My vote would be to let them do their thing. It amazes me that Dr. Jacobs has brought us this far and people still doubt his judgment. Oh well. Best regards, Gregg

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