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Technology Stocks : The New Qualcomm - a S&P500 company -- Ignore unavailable to you. Want to Upgrade?

To: Ramsey Su who wrote (8460)	4/9/2000 11:35:00 AM
From: A.L. Reagan	Read Replies (1) \| Respond to of 13582

Ramsey, we all agree (including Tero K.) that the question regarding Q's patents on essential IPR for any kind of CDMA implementation has been beaten to death. I too have read this and the prior thread for 2-1/2 years. That is not the question being posed at this time. Over the period you cite (a) Q has been busy developing the means to get from IS-95 to "multi-channel" 3G CDMA; (b) apparently NOK and the much reviled IDC have been busy bees developing, and filing patents for, various elements of overlaying CDMA onto time & frequency division protocols. There are a bunch of new patents out there that have not been looked at from the perspective of a W-CDMA implementation. In addition, for whatever it is worth, the W-CDMA forces seem to have gathered more steam in the past six months than many (myself included) would have expected. It is quite possible (some would say probable) that the ultimate number of "DS" mode 3G subscribers will exceed that of "multi-channel." Accordingly, it is a reasonable assertion that Q needs to participate in the DS mode market as more than just a basic IPR licensor. In order to do this, Q either does or does not have to x-license IPR from NOK/IDC. That is the question, (not the beaten to death whether NOK must license from Q) and it is a big one financially. [Granted, not as big as the transcendent applicability of Q's patents over W-CDMA was when you guys thrashed it out two years ago, but arguably the largest current unknown now that ERICY and MOT are in the fold so to speak.] So what we are trying to understand in these series of posts are NOK/IDC's recent patents on W-CDMA air interface overlay implementation, which was not a topic ever addressed by Gregg Powers (since he quit posting before these patents were filed). To restate the core question: "Can Qualcomm design and market ASICs for the DS mode of 3G CDMA implementation without infringing any NOK/IDC essential IPR?"

To: Ramsey Su who wrote (8460)	4/9/2000 1:09:00 PM
From: quidditch	Read Replies (1) \| Respond to of 13582

The real question out there seems to be not so much IPR as Q's ability to continue to rake in both chip sales and license revenues across all 3G flavors. For a moment, let's give Tero his due and assume that he is correct that DS will be the dominant mode of 3G: if he is correct, it will be absolutely critical for Q to stay involved and at the forefront of DS developments, or Q and MC will indeed be marginalized. If Q can/does not participate in a DS ASIC market and loses the chip sales revenue opportunity (aside from CDMA2000/HDR), Q risks being out of the game of cutting-edge developments in the DS flavor of 3G and future IPR. That's when IPR will become the deathknell. In 2000, it seems that, yes, all who play the 3G game--whatever the flavor--pay license fees to Q. Q's style tends to be understated--various possibilities as to what's going on in DS: - perhaps ERICY's support for 1X/HDR heralds a wider, deeper and more meaningful cooperation--including W-CDMA--not a bad combination to promote DS, eh, should that be the (political) wave of the future?; - perhaps Q is going it alone with its recent acquisitions (w molloy's "worst kept secret" could apply to either); - perhaps Q's "arrogance" militates against conceding that DS is a real contender--i.e., Q's management makes a serious error in judgment--and fails to diligently pursue a multi-mode chip; what have we come to expect from Dr J? Management's central thesis is CDMA adoption. And, given the uphill battle QUALCOMM has had to fight for CDMA, management is nothing if it is not aware of the impact of the political vote in the outcome of the technology games. All of us are looking for the most robust business model possible from Q: that means (i) ever-increasing royalty income; (ii) increasing MSM/ASIC revenues; (iii) revenues from the other known components--Omnitracs, WK, WIL; and (iv) other components of the Shy Guy's third leg of the stool. What seems to be in doubt, at this time, is not so much the IPR. Even if Q did have to pay NOK/IDC some license fees for W-CDMA (and the makers of DS equipment would have to pay Q), GSM is out there as a core network and the DS IPR resolution is not so clear as a pure CDMA2000 solution. So even though I think ALR's questions are valid, I tend to discount that as the major item facing Q in this latest "dark age" before the Holy Wars II are resolved. Steve I seem to recall that Dr. J indicated either in the analyst presentation or the AGM that development of 1X and HDR could well postpone the need for 3G. That may explain an ERICY/Q strategic combination. Of course, if 1X and HDR are not widely adopted, then early adoption of DS becomes a strategy disruptor.