Brian,
Let me begin answering that question by conceding one point I can already hear you making: there is no question that ERICY is a little too wedded to its own technology. There's no room for dogmatism in business.
That said, I'm not sure if it matters who wins in the 3g standard debate; any company with any brains is going to license whatever technology wins. (I should point out here that under QCOM's view GSM still plays a role, and there will still be demand for those products.) If CDMA turns out to be the next generation standard, I'm sure ERICY will move to it, as LU and NOK.A seem prepared to do. And when that happens, it will be tough to shake the leaders from their hugely dominant positions.
CDMA is a great technology, and I almost bought QCOM last year, but I didn't because I think QCOM is going to find itself in the unenviable position of competing against its own licensees. Sure, they will get fees for that, but they could also wind up losing a lot of contracts involving their own technology. Market leaders do not give up their positions easily. They do occasionally -- witness MOT -- but my experience has been otherwise. Two years ago, I owned ASND, CSCC, XYLN and CSCO. Guess which one I still own? Yup, CSCO. Leaders are challenged all the time, and when that happens, they adopt the challengers' technology and keep winning. I'm betting ERICY will do the same, and anyway, they have a huge installed base that will give them steady growth for a long time, and if QCOM wins there's still room for GSM anyway. Good luck to you; we see eye-to-eye on just about every other issue.
Paul |
