Qualcomm Incorporated (QCOM) Message Board

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Technology Stocks : Qualcomm Incorporated (QCOM)

QCOM 170.65

+1.5%

Dec 2 3:59 PM EST

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To: Gregg Powers who wrote (12371)	7/15/1998 2:54:00 AM
From: Bux	Read Replies (1) of 152472

Gregg, you say management has assured you that the net outcome (of reducing royalties to all) would be a far greater royalty stream than otherwise would be the case and you provide a simplified example (3% of 30 < 2% of 100). How does this jibe with the popular assumtion that no mobile CDMA is commercially feasible without QCOMs IPR and with QCOMs statement that they will not license WCDMA that is incompatible with CDMAone. Deduction dictates that either management might be willing to license their IPR for non-CdmaOne systems (presumably at a much, much lower royalty) or that Europe and presumably other regions either not adopt CDMA systems or will be so delayed in their adoption that royalties would suffer greatly. I appreciate all the insightful analysis and input you have provided to this thread, and this is the first thing you have said that is not crystal-clear to me. I realize your example was hypothetical, perhaps it was an extreme example of possible royalty reduction? Would not a 5% to 10% reduction in the royalty rate seem to "grease the wheels" adequately in light of QCOMs strong IPR? Jacobs himself was quoted recently as saying he thought it remote that Europe would manufacture mobile CDMA without a Q license so avoiding litigation over IPR would not seem to be the motivation. Is there perhaps possible litigation over protectionism or unfair trade practices if QCOM withholds licenses just because the IPR would be used for a network that is incompatible with CdmaOne? Just a thought. Regardless of all the "unfinished business" I am quite pleased with the way things are shaping up and while Maurices prediction sounds a bit optimistic, I think it will prove to be almost accurate. Bux (SBUX not $)

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