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Technology Stocks : Qualcomm Incorporated (QCOM) -- Ignore unavailable to you. Want to Upgrade?

To: T L Comiskey who wrote (68084)	2/29/2000 10:53:00 AM
From: John Hauser	Read Replies (2) \| Respond to of 152472

Wireless Telcos Find Talk Is Cheap By Scott Moritz Staff Reporter The wireless data partnerships made public at the CTIA Wireless 2000 industry conference in New Orleans on Monday read like an orgy of VIP business cards. Microsoft (Nasdaq:MSFT - news) agrees to develop applications with Qualcomm (Nasdaq:QCOM - news) , sending the latter's stock up 7%. Qualcomm sets a deal with the anti-Microsoft Psion to work on smartphones. And AOL'S (NYSE:AOL - news) "anywhere" strategy has it aligning with nearly everyone -- including Motorola (NYSE:MOT - news) ADR), Nokia (NYSE:NOK - news) , Sprint PCS (NYSE:PCS - news) and Research in Motion (Nasdaq:RIMM - news) -- to build phones with instant messaging. But take another look at your cell phone. Sixteen years into its evolution, it remains a far cry from an Internet appliance. In fact, it barely can provide you with a fault-free conversation, let alone Net trolling, restaurant reservations and stock trades. So it's important to keep a little perspective on the state of wireless today, say some observers -- the performance of telco highfliers such as Qualcomm notwithstanding. Network News "The hype behind all this is coming from the vendors, who are saying now you can have a PC in your cell phone," says Brian Cotton, director of communications consulting for Frost & Sullivan. "And of course, the network folks are boasting about their data capabilities. But the reality of it is that the networks are not ready. " Cotton's clients include Ericsson (Nasdaq:ERICY - news) ADR), Lucent (NYSE:LU - news) and GTE (NYSE:GTE - news) . Takeover speculation and data hype already have contributed to the run-up in astronomically priced wireless telcos such as VoiceStream (Nasdaq:VSTR - news) and Nextel (Nasdaq:NXTL - news) . But it will be at least 14 months before the more aggressive wireless carriers, such as Bell Atlantic (NYSE:BEL - news) and Sprint PCS, upgrade their network equipment to enable email service that vaguely approximates desktop email, says Cotton. And even then, those features will be limited to a couple of cities initially. In other words, these deals have little application to today's wireless user, and any real sales impact is still a few years ahead. Even in 2004, Chase H&Q estimates that 80% of wireless revenue will come from voice service, with a mere 13% from email and 5% from Web access. The Nonexistence Problem "Mobile data services are essentially nonexistent in North America," Chase H&Q analyst Edward Snyder wrote in a recent report. "While the future looks bright for data services, today's infrastructure can only support low-rate, circuit-switched connections at best and voice-only at worst." Snyder has a buy on Nokia and Motorola and a market perform on Qualcomm and Ericsson. His firm has not done any banking with these companies. But that doesn't stop carriers from pushing the data business while it's hot. Wireless telcos, desperate to sell services and keep customers, are "trying to position data as the killer app," says Cotton. "They'll promise you the world, but they deliver a two-way pager."