pcstel,
You have tossed a lot of ideas around here in the last month or so, but your thought that suddenly the W-CDMA ASIC market will become saturated with abundant suppliers is near comical. If there is anything that we have seen in the years of following this market is how vastly difficult it is to produce a viable CDMA chip. Q has had licenses out for years to other companies, including Intel and Nokia, to produce CDMA ASICS. Nokia has in more than five years managed to now produce an occasionally stable basic chip for IS-95A, how many years after Qualcomm? As for the 1X market, they have already conceeded and will have Telson in Korea rebrand phones with Qualcomm chips. Intel bought its CDMA chip license, only to later announce that they would not be spending any additional time and money developing the chipset.
The bastardization by committee W-CDMA is going to be even more complicated than CDMA, do you seriously believe that an "Asian" manufacturer is going to suddenly appear with a "$7" product?
One of the points that Gregg Powers made years ago was that the dual mode CDMA-WCDMA chip that will eventually be required throughout the world will actually be a great positive for Qualcomm as its complexity will be Qualcomm's greatest barrier to entry from competition.
The secondary thought to this is that even in a worst case scenario that viable competition should emerge, the market that Qualcomm is producing for will be increased from less than 20% to near 100%. Q now has 90% plus of near 20% of the world market. Using round numbers.
Current
90% market share X 20% CDMA share world market X 500 Million World Market = 90,000,000
Worst case 50% market share in 5 years
50% market share X 90% W-CDMA&CDMA world market share X 1 Billion World device market = 450,000,000
Best Case
80% market share X 90% W-CDMA&CDMA world market share X 1.5 Billion device market = 1,080,000,000
With Telematics and Modem Cards and other yet to be devised products, 1.5 billion is not an unapproachable number. These numbers are why I am here. |
