Qualcomm Incorporated (QCOM) Message Board

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Technology Stocks : Qualcomm Incorporated (QCOM)

QCOM 163.32

+2.3%

Nov 21 9:30 AM EST

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To: Dave who wrote (14772)	9/10/1998 3:19:00 AM
From: Asterisk	Read Replies (2) of 152472

Dave: You make a good point. No there definately is not only one solution to the question of mobile CDMA. The real value of QCOM IPR is that it is a full answer without having to send your research department out on a multi year, multimillion dollar quest that is not guaranteed to give results. Let's please clear something up here. CDMA was NOT invented by Qualcomm. CDMA has been around for quite some time as a signalling standard. I believe it had its first applications in military sattelites and military communications due to its extreme resistance to jamming and evesdropping. What Qualcomm did was to take the general idea of CDMA and apply their collective brains to come up with an elegant way to use it in the portable wireless industry. They brought together some well tested ideas, some ideas that were new and some ideas that were out of left field that worked. They got som patents for how they applied these ideas and they got a standard (IS-95). Basically they took a gigantic leap over where the state of the art was at the time. You can see just how big the step was if you look around at how incredulous people were that it worked. Thie in no way means that there are not other ways to implement wireless CDMA networks and anyone that says so is an idiot. But QCOM has the most elegant, efficient, and cost effective way of doing it. I think that anyone that you ask on this board would encourage other companies to come up with new and novel ways of applying CDMA. I also think that most of the people on this board would agree that QCOM is not demanding that all CDMA applications be liscensed through them, that would be absurd. It is not however absurd to ask for a reasonable sum of money for them to hand over the results of their extensive laboratory and real life experamentation. I think that everyone agrees that they should be compensated if a wireless telecommunications technology uses their ideas. Now it is just about the differing definitions of reasonable. QCOM has worked hard for their patent portfolio, some of which is absolutely impassable if you want to do wireless CDMA (fast power control). If I may I would like to wind up this diatribe with a historical example that directly applies. In the early 1800's the Smith and Wesson(?) company came out with a gun that used cartridges for its ammunition. This enabled the fast, efficient and safe loading of their guns. Sensibly they patented their innovation and for something like 20 years did not allow anyone to use their idea. This gave them an overall lock on the handgun industry for this period of time. Not to say that there weren't other great guns or great companies but they could not use the S&W idea until their patent protection ran out. After the protection ran out the entire gun industry pounced and immediately began using this idea. The moral: Patents do not last forever but if you wait in this time and economic reality for peoples patents to run their course (especially in a fast paced world like the wireless industry) then you run the chance of being left behind. Ericcson took that chance and is now paying the price. They are playing an extremely high stakes political and economic game that they hope to win. If they do then they have a cheap liscense, if not then they have been left in the dust.

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