Hello Richard
1. CDMA in general (wide OR narrowband) still has a problem with acceptance (witness the on/off again situation in China) in relation to GSM.
Regarding narrowband CDMA - It has excellent acceptance in the US, Korean, Japanese and some Latin American markets. The Chinese market is being negotiated as we speak. However, it is worth noting that the largest GSM network to date is in China.
2. Even with CDMA acceptance, QCOM has already won the day since narrowband CDMA seems to be the more accepted standard.
QCOM is doing very well with current 2G narrow band CDMA. However, next generation digital systems will use some form of wideband CDMA. IDC signed an cross license agreement with QCOM in 1994, in return for a one-off payment of $5million. It is disputed whether this agreement extends to 3G - wideband (i.e. WCDMA)systems.
QCOM holds several wideband CDMA patents, and also sponsors the cdma2000 standard, which has a high chance of adoption within the US. It is unlikely that cdma2000 will be adopted in markets that are currently GSM.
NOK has entered into a WCDMA development agreement with IDC. IDC is also states that NOK is licensee for IDC WCDMA intellectual property. NOK is clearly looking for a way NOT to use QCOM WCDMA IPR.
In other words, I am puzzled as to why I should invest in IDC (not knocking it, just researching it).
IDC is a risk play, with two components.
1. The ERICY TDMA patent dispute
IDC is claiming essential patents for TDMA. ERICY disputes this. IDC lost a similar case against MOT.
If IDC win, they could claim a royalty backpayment against GSM, IS-136 (US TDMA), and PHS/PDC (Japanese TDMA) systems vendors. I've asked the IDC hawks how they would collect backpayments and to speculate on the rate
2. WCDMA
This is a 3G system. Several independent commentators are now predicting that large scale commercial 3G system rollout will be later rather than sooner, and is several years away. How IDC patents stack up against QCOM (and others) patents has to be tested, either through negotiation, patent pooling or in court.
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