w. "...They made it very plain that they would not do business with a competitor, despite the quality of the product..."
Within reason of course. Ericy and many other licensees have decided to do business with Q! for intellectual property and for ASICs despite Q! also making handsets and competing on infrastructure until now.
They WILL do business with a competitor if they have no other choice. Or they will go into a new line of business such as making the beds and serving the meals of the wealthy Q! shareholders who might visit their neighbourhoods. As you say, people far prefer not to deal with a competitor, but sometimes they have to use a bit of judgement.
Just as Q! has formed a joint venture with Microsoft, who is competing with Q! on email and software for Pentium chips on PCs which will compete with Anita [TM] WWeb devices.
There's a balance. Successful companies like Nokia figure it out early. Nokia signed up with Q! about 1991 or maybe even sooner for non-disclosure agreements etc. Less successful ones such as Ericy come scrambling in at the last minute with a terrible competitive position to try to rescue the situation. No way were Ericy going to do business with a competitor!
On the handsets, I really don't see any reason to sell the manufacturing process. Q! is the top seller of CDMA handsets and will do even better when Globalstar gets going. Sure the Q! market share will drop as the horde of licensees continue to develop successful products. But profits are fine. As we'll see on 20 April though margins have shrunk slightly on huge sales.
Q! seems to be doing just fine at making handsets. They have sufficient economies of scale, brand image, market share, ASIC relationship, technical understanding and all that. Nokia and Sony might buy the handset business to expand production quickly, but I doubt it would be worth it compared with just building their own lines flat out and taking Q! customers by offering better and cheaper products. It all depends on the price.
Also, developments such as WirelessKnowledge and Eudora will integrate very well into handsets, so it's desirable to have control of the holistic package - even to the extent of having the base station ASICs still in the fold. That's a very powerful position.
I can't see the handset part being sold any time soon. But I'm sure Nokia will be going flat out to get big success in CDMA despite Tero continuing to claim GSM rules the world [well, China anyway].
Maurice |
