Maurice:
Thanks for the kind words. To be honest, I am far more impatient with the silly and superficial analysis emanating from certain highly compensated Wall Street analysts then I am with QC's stock price. As you well know, stock prices fluctuate based on fear and greed, often detaching from corporate intrinsic value. In my experience, time and patience always resolve such inefficiencies..
As for your cdmaOne handset question, let me answer your question indirectly, by explaining how I look at the world (literally). I maintain a continent-by-continent map of global CDMA networks, categorized by deployment status (i.e. commercial, pre-commercial, trial etc.), network type (digital overlay, PCS or WLL), population density and competitive environment (duopoly or multiple provider). Around this template I make a series of penetration assumptions, ranging from very conservative to aggressive, calibrated (hopefully) to reflect carriers' strategic imperatives (i.e. PCS networks, being entirely digital, ramp faster than digital overlays were analog customers are being migrated etc.). From this model derives my estimate of worldwide CDMA subscriber growth for this year and next. Now, here is the key point. Until recently, there were large population centers (Europe, for example) that appeared foreclosed to QC. With the advent of W-CDMA, my worldwide template has to be expanded materially. This is very profound, yet many analysts seem confused about the implications.
If Ericsson had overtly capitulated and signed an IS-95 license with QC, the investment community would have been ecstatic. Such an action would have unimpeachably validated CDMA as the superior technology and driven a stake through the heart of ERICY's TDMA-based GSM business. As a clever marketer, but recognizing the inevitable, Ericsson is attempting to finesse the issue by developing a "proprietary" flavor of CDMA, holding this out as the "proper" successor to TDMA-based GSM, and suggesting that, for some reason, IS-95 is structurally inferior. This, as you succinctly observed, is total horse poo-poo because Ericsson's flavor of CDMA is not materially different from IS-95 (i.e the technological underpinnings are not bandwidth dependent). As maintained by Qualcomm, ETSI and DoCoMo, and further confirmed by the Lucent/Philips license, if you want to do mobile CDMA you need QC's IPR. So, to my mind, Ericsson has now publicly committed to QC's CDMA and it is just a matter of time until a myriad of new license agreements get signed.
QC's economic opportunity thus has been expanded almost as if ERICY had signed an IS-95 license. This conclusion is important, profound and thoroughly misunderstood or discounted by Wall Street. It should be amusing and pleasurable to watch the gap between external perception and internal reality close.
Best Regards,
Gregg |
