The bottom line is, IMO, simple: Europe chose not to allow competition between technologies, but instead mandated just one - GSM. This results in massive efficiencies of scale as competitive capitalism kicks in. Good for them. However, the US allowed competition between technologies, which results in a little less efficiency of scale, but does result in capitalistic competition for better technology. The result is Qualcomm. I do not begrudge the Europeans their system - it has its advantages - but they shouldn't complain about the US companies that reap the rewards of the US system.
All JMO.
Clark
PS In regards to the CMP article which has Ericsson slamming Qualcomm again, I suspect that the quotes in it are old compared to the Japanese news. We'll see. As for what Qualcomm will settle for:
1) A change of the 3G standard that includes the following:
a) A change in chip rate to allow installed CDMA base stations to work with minimum modification. (Note - I still don't really know why a multiple of the current chip rate is so much easier, but I would guess that the clock in current equipment is stepped down from some integer multiple of the current chip rate that is also an integer chip rate of the proposed chip rate. Anybody know?)
b) A system that will allow the ground interface to be either GSM compatible or TDMA/CDMAOne/AMPS compatible.
c) One or two more minor changes that minimize the cost of installing upgrade equipment to move from CDMAOne to WCDMA. This allows Qualcomm to continue to sell CDMAOne equipment because they can promise a cheaper upgrade path than GSM. I predict they will not, repeat not, give in until they are very confident that is true.
2) Qualcomm will substantially lower their royalty rates. They will reasonably reason that, politically, point number 1 is much stronger (and as Maurice points out, the politics are important, however regretably. Point #1 is stronger politically IMO because Ericsson was so obviously playing unfair by stacking the deck towards GSM and not even allowing Qualcomm much of a vote.). Nonetheless I would expect that they will still have royalty rates that are higher than the norm for a 'standard' |
