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To: LindyBill who wrote (3426)	7/4/1999 9:22:00 PM
From: gdichaz	Read Replies (3) \| Respond to of 54805

LindyBill: Since your son in law works for the Q, we have to assume that your information is based upon his view. I for one hope he and you are wrong, wrong wrong. For the Q to part with their handset business to the likes of Siemens is a tragedy - pure and simple. Ugh. But frankly, I don't believe it. On the other hand, a joint venture with Siemens or some other way to "partner" with Siemens a la Sony would be positive IMO. Guess, we will all just wait and see. Cha2

To: LindyBill who wrote (3426)	7/6/1999 3:56:00 AM
From: Apollo	Read Replies (2) \| Respond to of 54805

Lindy: >>Q's phone division's name will soon start with an S<< I think bookmarking Gregg Powers' comments on Q is an excellent recommendation. I did reread his assessment of the Q/Ericsson deal you posted. You hinted at the possibility of Q selling the handset division. It seemed that, at least in one post, even Gregg Powers would not have recommended that (see below). As a non-Accountant with a weakness in interpreting balance sheets, I don't understand why the Q would sell a profitable division. We had previously heard that the cellular infrastructure division sold to E was the only money-loser. If the handset division is therefore profitable, which Greg Powers' comments would support, then why sell it. Furthermore, if a company sells a profitable division, wouldn't annual earnings then be less than expected.....ergo, wouldn't earnings per share decline.....and would it follow that the price/share would reflect these reduced earnings? I understand that one reason to sell the handset division would be to not compete with potential customers of ASICs. But how would a company guarantee increases in its ASIC sales, that they would hope would offset lost profits from handsets? I suppose an analogy would be that MSFT and INTC don't compete with boxmakers. What does the thread think? Stan (exposing my business ignorance here) To: w molloy (27141 ) From: Gregg Powers Thursday, Apr 15 1999 12:35PM ET Reply # of 34070 Sell the handset division? Pray tell, why should the company do that? Hopefully not because some (still) misinformed analysts would prefer simpler spreadsheets! I presume you realize that Qualcomm has a substantial embedded margin advantage in handsets? You recognize, of course, that the company does not have to 'pay itself' royalties? On top of this, everybody else is either buying ASICs from Qualcomm (the margin on which QC again does not have to 'pay itself') or is spending a fortune (on a fully allocated, unit cost, basis) to develop their own chip. Given these dynamics, QC should have an embedded margin advantage somewhere between 500 and 700 basis points....which is roughly twice the operating margin achieved by MOT its entirety last quarter. After some annoying fits and starts, the team of Jacobs and Dollard seem to be making lots of progress. My vote would be to let them do their thing. It amazes me that Dr. Jacobs has brought us this far and people still doubt his judgment. Oh well. Best regards, Gregg