Glad to see a skeptic on this thread, we can all learn by debating the pros and cons of this company's future. While I disagree with your position, I can understand it, but differ with you on several points:
QCOM will face competitors who will try to circumvent its patent on CDMA
And Intel has faced the same situation for how long? It has not slowed them much. And Q does not have a single patent, it has multiple patents. It is one thing to try to circumvent, another one to do it in a way that is held up in courts. The one area I would worry about is China, because they don't have the best record for observing patents.
CDMA has yet to be recognized as a standard in Europe and China
What does it take to be recognized as a standard? Why would a Chinese manufacturer ask for permission to manufacture CDMA phones unless they thought it was the standard to be built to? Why would China allow five manufacturers to develop CDMA, and why would Korean Economy Minister Kang Bong-kyun ask for Chinese permission to help build out their CDMA infrastrucute? Better yet, why would China, with pretty much a clean slate, go to a lesser technology, TDMA or heaven forbid GSM when they can jump into the state of the art?
As far as Europe, do you think they would remain in a backwater if and when they saw the rest of the world adopt CDMA?
QCOM's future depends entirely on the success of CDMA, which means that a technology developed in the future could obsolete CDMA.
True, that is the way technology evolves. But by the time a competing technology makes CDMA obsolete, the 1000 target will seem quaint. If/when CDMA infrastructure is in place, how long do you think it would take for a competing technology to supersede it? Look at TDMA and GSM. Heck, look at Dell, how long did it take for competitors to match the way they built and sold PCs
The "analyst" who set off the current buying binge made some pretty outrageous assumptions, not the least of which were:
-- 3 Billion hand sets sold in 2010 (about 50% of the earth's population)
OK, that assumption does seem stretched to me, for handset sales. But not for device sales. First, 3B is 50% of the current population, not the 2010 population. Let's say that in 2010 the population is 7-8B, so 3B is still a large percentage, but if we are talking devices (cellulars, personal assistants, devices to interoperate with your stereo, tv, car, etc), it is not a 1-1 between devices and people. How many people today have more than one PC, more than one phone, more than one TV. If the average is two such devices per person, that is a penetration of 1.5B out of say 7B population, not as far fetched. The average may well be 3 or more per person.
-- a terminal value of 60x earnings (with 3 Billion hand sets sold in 2010 who is left to buy? Perhaps QCOM will be selling hand sets to Martians).
Again, this seems too high for handsets, not so for HDR devices, with technology that even in ten years should be in the ramp-up phase.
Thanks again for visiting! |
