To: idler who wrote (56363 ) 12/23/1999 12:26:00 PM From: Rhino Ray Read Replies (1) | Respond to
This deal is a definite WIN - WIN for QCOM. Think of this they sold off the money loosing division and got cash for it. Then they will get more money, for KYO gave Q a guaranteed promise to purchase more (at least 70%) chipsets. They no longer have any of the headaches, or costs associated with the handset division yet will still get the money for each phone sold, since KYO is paying for the chips. There is no doubt that Asia represents the fastest growing area in the world for wireless. Also as Dr. J made reference to, it is highly likely that cell phones will go through revolutionary changes every 18 months, with new higher tech phones. This is where the phone manufacturers can loose a lot of money initially with the new retooling etc. or even worse loss of market share due to not having the newest, coolest, and "hottest" phone out there. Yet QCOM still makes out because it's still the Q-chips inside. Q management has thought this out well. And as the analyst from Lehman said, this is the deal that QCOM really wanted. It meets all the requirements, including what I believe represents the biggest desire from Dr. J. and QCOM and that is that KYO will help introduce HDR faster than any other company putting some real pressure on the other wireless providers. Remember, the people of both Korea and Japan are much more into the wireless world than we are. And I see an earlier than expected intro in those countries into HDR technology.
