John- Thanks for the belated Thanksgiving thoughts which were worth the wait.
You wrote- “Maybe you are right after all and I am wrong. Maybe I should have been thinking that the business tracks adds plus churn. “
It was quite gratifying to see that you are starting to recognize that Qualcomm and CDMA handset sales (“business tracks”) are related to areas other than just subscriber growth. We’re making progress. However, may I again point out that Qualcomm handset sales growth potential is more than “adds plus churn”. It is my understanding that “churn” refers subscribers deactivating service ( leaving one network to join another, or just curtailing wireless service altogether). Qualcomm and CDMA handset sales should outperform overall wireless subscriber growth/ handset sales for the following reasons-
1. The CDMA share of world wide subscriber additions should increase as CDMA2000 is the only commercially viable 3G solution at present and probably for the next couple of years.
2. 3G CDMA2000 carriers should be able to differentiate their services from non-CDMA carriers by offering higher speed data services at a lower cost to their subscribers with 1X and EV-DO networks and thus increase the potential for their subscribers to upgrade to more feature rich handsets. In essence, CDMA carriers have two meaningful (not superficial) upgrade cycles presently taking place, 1X followed by EV-DO which should drive higher upgrade rates than their TDMA/GSM carrier counterparts.
3. When the GSM carriers convert to WCDMA those subscribers will be “CDMA” subscribers.
4. Certain GSM carriers and new 3G networks to be deployed in the future (China) may decide to opt for CDMA2000 due to the continuing problems with WCDMA network deployments
5. The U.S. CDMA carriers offering commercial 3G CDMA2000 services should be able to reduce churn and draw subscribers (crossovers) from TDMA/GSM carriers (AWE, cingular, etc). CDMA2000 carrier KDDI (1X now and EV-DO next fall) in Japan may even be able to obtain crossovers from JPhone and DoCoMo .
6. The South American TDMA carriers should be more adapt to convert to 3G CDMA2000 after viewing the real 3G successes experienced by CDMA2000 carriers vs the continuing problems experienced by the GSM carriers in their WCDMA network deployments.
7. Certain GSM carriers (VOD, Unicom) are potential candidates for conversions to GSM1x (a Qualcomm 3G solution for GSM carriers), as they own both GSM and CDMA networks.
8. With the MSM6300 (GSM/GPRS- CDMA2000 1X “world phone”) chipset, Qualcomm and their handset partners will soon be able to supply handsets to virtually all carriers (GSM / CDMA) in the world. These handsets, whether they’re counted as GSM or CDMA, will be counted as Qualcomm handset sales.
I’ve been following Qualcomm, CDMA, and wireless for over six years, and I’ll admit it hasn’t been easy to separate the FUD from reality at times. Heavens, even the professional “analysts” and consultants continue to exhibit much misunderstanding of CDMA and the wireless sector.
As I said, it’s gratifying to see one making progress, even one step at a time. Perhaps your next step might be to listen to some of the archived Qualcomm “analyst” presentations. I recommend the five hour London “analyst” meeting held last month.
Keep up the good work. Jim |
