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Technology Stocks : Qualcomm Incorporated (QCOM)
QCOM 164.00-1.7%12:10 PM EST

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To: Mika Kukkanen who wrote (19591)12/11/1998 10:54:00 PM
From: Clarksterh  Read Replies (1) of 152472
 
Mika - We seem to cover the same ground again and again:

The Ericsson announcement and Nokia's support is a proposal. Reducing the chip rate from 4.096 down to the cdma2000 3.6864 represents a 10% reduction. What many people fail to realize is what really is this reduction in performance? Well, it is capacity. 80% of the digital mobile world are still TDMA based...are you asking them to cut 10% off future revenue? If so why? It seems to be the Qualcomm argument for CDMA over GSM, i.e., increased capacity.

Why should the minority dictate the majority?


As I've said before, when it comes to CDMA and chip rates Qualcomm is the majority. So much for the moral standpoint. As for the capacity issue, as has been discussed many times, if everything else is equal, then it is true that the higher chip rate will get higher capacity. But everything is not equal. In order to fit within the bandwidth they have to use filters which may not be sufficient, and in any case kill much, if not all, of the extra capacity. An analogy, although a poor one, is that the 5MHz bandwidth is like a pipe, and WCDMA is trying to stuff so much through the pipe that they produce non-linear effects which significantly degrade the performance. In fluid mechanics there is actually an optimal pressure. Increasing the pressure beyond that point actually decreases flow. While I am neither a filter designer, nor do I have the detailed models it is a good bet that the higher chip rate hits that wall, but that Ericsson, lacking the same models that I lack, didn't know until recently.

But I will say, the ITU will have to go with multiple standards (the market wants it!).

Hardly! Qualcomm owns much of the IPR. If they say no then there will be no ITU 3g CDMA standard. Too bad for Ericsson. But Qualcomm can continue merrily with CDMAOne and its follow ons whether they are ITU approved or not. The same is not true of Ericsson since they would likely loose (have to live up to the stereotype) an IP fight and know it.

Clark
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