My father said of my mother "You don't keep a dog and bark too!" At first blush, that is not a very nice thing to say about one's wife, but in fact what it really meant was that she was running the show in the issue being discussed. My mother [died 1984] was a big dog before the modern sissy supportive feminists demanding favouritism legislation [women-owned businesses getting special deals on spectrum for example] appeared or were even born. Why, she even took Germaine Greer to court - and won! NOT that she bore any malice towards Germaine, who I have generally admired [unlike some unpleasant SI Moonie 'feminists' who wouldn't know a sexist if they saw one in a mirror].
Anyway, before anyone accuses me of raving, the point is that QUALCOMM need not give the barking job to a bunch of ASIC licensees to satisfy a multitude of applications and then start barking too! Okay, it was essential in the early stages to ensure ASICs were made and made properly to get into the business. It was also essential to have multiple suppliers so that potential customers would not think they would be stuck with a single supplier.
Now though, huge profits have been made on ASICs. There are heaps of ASIC designers off and running for their own use and for others.
The primary and wildly successful values of Q! have been to be a creator and maker of early to market technology leading systems in electronics/photonics and software. Prosaic production schedules and product differentiation are not really their thing.
So why have a dog and bark too? Q! has got the biggest, baddest dog in an increasingly noisy neighbourhood and it would fetch a very good price. Nokia would love to have their own ASICs I bet. AND they have got a LOT of lovely moolah to pay for it. AND that would really kick CDMA along at an early stage and get the 3G thing rolling at 100mph.
Then, [among other things] Q! could buy Globalstar and Loral for a song and really make things happen. Sell off the other parts of Loral and turn Globalstar into the biggest baddest worldwide cellphone system with 1 billion customers in 15 years and REALLY get the world onto 3G.
Slash the wholesale minute price to 5c for the first two years as an introductory SPECIAL 'for a limited time' just like McDonalds. Sell a few million handsets, get a lot of royalties. Develop the ASICs more [having kept the G! ASIC business]. Then, when demand has grown and things are going crazy, raise the minute price to what the market will bear.
That will give a jump to the dozey Service Providers who will figure out that they will have to get a lot of subscribers in the first two years or miss out on the subsequent BIG profits. So they'll slash their retail minute prices to below terrestrial roaming and below many retail minutes too.
Grab it before Vodafone gets their greedy paws on it.
Terrestrial CDMA is starting to become a commodity business. The big work has been done. HDR is on the way. China is about to install 3G foundations.
Q! has got a BIG stack of cash coming in and can get a huge stack of cash from the ASICs business.
The thing that I don't like about selling the ASIC business is that people will have joined QUALCOMM's ASICs division because they want to work for QUALCOMM and Irwin Jacobs, Andrew Viterbi and co. They don't really want to be slimed in the Nokia and Ericy world of Hagfish - which is still oozing slime over the 3G business.
But I suppose that's business. There's no guarantee of lifetime employment. I can have my shares sold out from under me despite a decade long fan club membership. Employees can have the division sold out from under them. Even Irwin can be booted out by the board if they don't like him. Board members can be ditched if they lose favour.
Thanks for the article EricL. Looks like a sale then! Actually, I have never seen anything wrong with competing with customers or one part of Q! competing with another. Competition is good. If a customer doesn't like it, they can buy their CDMA from China. But it is a lot of barking if there is no real need and somebody else will do a good job.
Mqurice |
