Qualcomm Moderated Thread - please read rules before posting Message Board

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Qualcomm Moderated Thread - please read rules before posting

QCOM 159.42

-1.2%

Jan 16 9:30 AM EST

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next

To: engineer who wrote (33010)	3/2/2003 4:23:07 PM
From: Art Bechhoefer	Read Replies (2) of 197253

>>lower royalty rates would not significantly increase teh chip sales<< Engineer, thanks a lot for your confidence in my analysis, but your statement above makes virtually no sense. If lower royalty rates result in greater unit sales, and if QUALCOMM chips are in most units (90 percent of handsets use QUALCOMM chips now), then lower royalty rates will lead to higher chip profits. Furthermore, lower cost handsets mean that service providers need not discount as much, or that competing service providers must offer competing services below cost. In any event, that kind of strategy from higher cost competitors can't go on forever, and sooner or later these competitors run the risk of being accused of predatory pricing (at least if they control more than 50 percent of the business in any trade area). Again, I think you missed my main point, which was to make royalty rates low enough (for a limited time, anyway) to create an offer they can't refuse. EVERYONE has a price, even the obstinate GSM oriented Europeans. Art

Report TOU Violation

Share This Post

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next