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Technology Stocks : Qualcomm Incorporated (QCOM)
QCOM 173.20-3.3%Nov 6 3:59 PM EST

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To: Stock Farmer who wrote (129495)6/3/2003 12:15:55 PM
From: Jeff Vayda  Read Replies (1) of 152472
 
John: R&D expenses are not linear, nor are they necessarily related to the position they are applied along the development path. The development path itself is not even linear!

Your observation of - early in the evolution some dollar amount provides larger benefits than the same dollar amount later - misses the "Ah Ha!" factor. I would suggest the linear, planned, predictable, actually executed plan is a very small minority of development stories.

I have no problem with Qualcomm throwing so much money down rat holes. You can never tell which rat hole will return the gem which launches entirely new lines of business. That said, there must be a balance and that is what I pay the management to provide. Sometimes it is appropriate to swing for the fence, no matter what your sunk costs are to date.

Jeff Vayda
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