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Technology Stocks : Qualcomm Moderated Thread - please read rules before posting
QCOM 171.63-4.1%11:20 AM EST

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To: foundation who wrote (31298)1/16/2003 4:10:13 PM
From: foundation  Read Replies (1) of 196520
 
See Spot Run, See SPOT Fall On Its Face!

By Andrew M. Seybold
<andy@outlook4mobility.com>
16 January 2003

Dj vu All Over Again

In Bill Gate's speech at CES about "smart living for the digital age" he spent some
time talking about SPOT (Smart Personal Objects Technology) and the wrist
watches that will include SPOT. I am reminded of when, years ago, Microsoft
announced its plans to put Windows in all manner of office device--office phones,
copiers, fax machines, etc.

The wireless technology will make use of FM broadcast sub-carriers. These
sub-carriers are part of a typical FM broadcast system and have been used for years
by companies such as Musack to deliver audio content and by others to deliver data
content. The use of sub-carriers, or SCA communications channels, has been
authorized since the 1950s.

My involvement with SCA communications dates back to experiments in remote
learning in the early 1970s and the three other attempts by computer companies to
use SCA communications for delivering data. These three aborted attempts were
made by Seiko, then the Epson division of Seiko and finally by Lotus prior to its
being acquired by IBM. Each of these campaigns was launched with great fanfare
and each failed for two reasons: The data being delivered was "news, weather and
sports," which had no perceived value to most potential customers, and FM
broadcast stations do not provide good enough signals indoors. (Most SCA
communications services today are to fixed locations with outside antennas.)

Oh, I almost forgot the system that was being rolled out by a company in Virginia in
the late 80s to provide stock quotes to handheld devices that could then be
attached to a phone so customers could place orders to buy or sell.

Let's look at Microsoft's foray into the world of SCA communications:


1) It will use the SCA communications system

2) It will be received by a watch with a small, inefficient antenna

3) It will deliver news, weather and sports

Sounds to me like this ought to be big! (Not). Microsoft has spent a lot of time and
effort (and probably money) putting together its Directband system of FM stations
to turn your watch into a smart device. I wonder if it was able to purchase the
thousands of watches that Seiko and Lotus must have stored in warehouses
somewhere

Real soon now (Fall, 2003) we will have a series of watches from Fossil and others,
service in 100-plus markets in the U.S. and Canada, and the ability to receive
up-to-date news, traffic, weather and sports information. There is no indication
either in the announcement or on the Web site (Microsoft.com/spot) of the
monthly cost of these services. What is on the site is a set of conceptual services
and watches so you can get an idea about these products that are "subject to
change without notice."

So here we go again. Three or more companies already launched this type of
product and service and they all failed at it. They found that what they were
offering was of little if any value to their potential customers, it cost too much and
FM broadcast coverage was spotty (no pun intended) at best. They also found out
that not that many folks will wear a big gadget watch or that many of the men
who are willing to wear one don't want to wear the same watch every day.

Can Microsoft be successful where others have failed? Can the might of Microsoft
and the "coolness" of the products and services overcome the problems with the
wireless coverage and the other issues? My bet is no. Not even Microsoft can make
this type of device, service and wireless delivery fly. History is destined to repeat
itself. As Yogi Berra said, "Its Dj vu all over again!"

The Outlook 4Mobility provides its news summaries and analyses free of charge.
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Copyright 2003 Outlook 4Mobility
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