Tero, Qualcomm handsets are very profitable thanks very much and the production rate is expanding rapidly. There seems little point in terminating something which is a great success. You harp on about declining market share for Q! in handsets. With 25 or so subscriber handset licensees, what did you think would happen? Qualcomm licensed those companies so they would produce huge amounts of CDMA equipment and they are starting to do so. Unsurprisingly this means a market share drop in handsets from 100% to probably around 20% or 10%. I'm happy with that.
The infrastructure division is about to become a great success too, with Ericy supplying a big stack of cdmaOne equipment to China. Yes, it won't be owned by Qualcomm, but Qualcomm has been paid for the infrastucture division by Ericy and will now receive a big stack of royalties on the infrastructure sales to Unicom, as well as ASIC infrastructure sales to Ericy as well as royalty, ASIC and handset sales to Chinese subscribers.
You continue to bamboozle me with your valuation of Qualcomm's handset business. I do agree that Qualcomm could spend all the royalties trying to support unworthy business units, but as you can see from the infrastrucutre business sale, they don't have a history of doing that.
The point is, Nokia is looking at a very serious competitor in the big new market of cdmaOne and WWeb. The success of cdmaOne is no longer a question. By the end of this year, there will be over 50 million cdmaOne subscribers. That has been a very, very rapid growth rate. There is a huge proliferation of cdmaOne handset makers. Q! market share will drop. Nokia is unlikely to enjoy the market share they have enjoyed with the restrictive trade practises, government mandated GSM world. Sure, Nokia will translate their expertise into a very high level of success in cdmaOne and WWeb technologies [well, they should do, but companies often fail in the paradigm shifts].
You seem to live very much in the present, which is a very American cliche. The world arrives from the future and the imagination of unknown people. Often those unknown people are in the existing large companies as you say, with their large incomes and big research and development departments. Qualcomm might not have the creativity to come up with the WWeb devices and functionality which subscribers will buy. But there is a good chance they will and I don't know who will do better, given the links between ASICs for handsets and infrastructure, handset device, software, Globalstar, Eudora and WirelessKnowledge.
You seem to deny the likely success of WWeb systems because of cost. The cost per minute of WWeb [be it cdma2000, W-CDMA or something else] is going to be quite moderate. Not cheap enough to watch videos on-line, but certainly cheap enough to book motels, send emails, voice mails and move money, rent cars, check movies, airline flight delays, maps, corporate infranets and a whole lot more.
There is certain to be a huge and wild success for these devices. Qualcomm has made a small entry with the pdQ and Nokia with their WWeb phone. These will not be more than an entree. Not even that. Just the aroma outside the restaurant.
You seem to disparage the success of Qualcomm. The IPO in 1991 was $9 per share. The price now is $200 per share. That's a very, very good return on investment. Qualcomm has had a litany of success [with a few glitches like contacts on the QCP820]. Similarly for Globalstar, the IPO was $5 per share [my buy at $3 per share] now priced at $20 per share, which is not a bad return either and that for a still speculative stock with a terrible example in Iridium.
The CDMA world is only warming up Tero. You and Nokia had better be ready because the tsunami is underway. NTT is in a very, very big hurry. China will be buying a LOT of CDMA. Forget the politics, CDMA is cheap and high quality. If Zhu Rongji doesn't like the USA he can buy from Ericy [still paying Q!], but still the CDMA will arrive. There is a balancing act for them between GSM and CDMA. They will maximize their returns from GSM, but they will introduce CDMA as it is economic, not when it is 'politically appropriate'.
There is a tendency to patronize China as though they are simpletons with dumb politics and bribery their modus operandi. Sure they might make some mistakes. But don't bet on it. They have got about 600 million kilograms of higher than average IQ to help row the boat! The USA has got about 150 million kilograms of below average [China average] brainpower. [Yes, yes, I know that brainpower hasn't traditionally been measured by the kilogram]. Statistics are such fun!
Maurice
Wafa, please don't clutter the board with comments such as "Get a Life" and other non-posts. I like to read useful things on these boards and posts such as your recent ones are messing it up. These boards are not here for your personal edification. How about contributing instead of specifying who should get lives [fancy adopting such a crass American expression of denigration - may a thousand camels pee in your tent].
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