Duane,
> Qualcoam was able to grow from vitually nothing, against much
> larger, well-entrenched competitors, based on its development
> and licensing of "superior technology"--CDMA. Tests appeared
> to indicate...
I note that you put "superior technology" in quotes, and that's where it largely deserves to be. You also correctly used the term "appeared to indicate." In fact, many of the claims just don't prove out to be true in the field. They were initially claiming up to 20x improvement vs. analog, now it's looking like 6x at best, putting it in the same range of capacity as GSM. They marketed it well, but that could hurt them too (see below).
All this was substantiated in a major article in Telephony (a trade weekly) article a couple of months ago which absolutely rips them apart and essentially says they lied up-front about the capability of the technology.
Mike Murphy follows this one on the short side, and he notes that this brings a huge liability risk. Many of the newer entrants to the cellular biz spent billions on frequency auctions, then more on QCOM equipment. If the technology is really only 1/3 as capable as QCOM indicates, that leaves a lot of companies with wrecked biz plans, and good grounds for lawsuits. I have mixed opinion of Murphy in general, so take it with a grain of salt, but I do see the risk if the expectation and results are so dramatically different.
Another issue is that they are being sued by both Motorola and Eriksson over patent issues. Messy stuff, but they can probably afford it least.
mg |
