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Technology Stocks : Nokia (NOK) -- Ignore unavailable to you. Want to Upgrade?

To: Mr.Fun who wrote (4993)	5/25/2000 11:16:00 AM
From: sisuman	Read Replies (1) \| Respond to of 34857

Great post - it's nice to see the facts placed in front of a thread intruder whose contribution only seems to be in the form of crying the "buy from Q" song.

To: Mr.Fun who wrote (4993)	5/25/2000 11:27:00 AM
From: slacker711	Respond to of 34857

. Sprint has approved the CDMA 5100. Word on the street is that Bell Atlantic has finally approved Nokia's most recent CDMA implementation. I really hope that you meant to say the 7100....the CDMA version of the 5100 (the 5170) is a two year old phone that currently shows up on the Sprint PCS discontinued list. I'm also not sure what phone BAM has approved...It's a little late for the 6185 to be approved. The tri-mode Startac and Audiovox are both better phones for a similair price. I'm still hoping for a CDMA version of the 7100....I dont care who's chips are on the inside. Slacker

To: Mr.Fun who wrote (4993)	5/26/2000 12:35:00 PM
From: rgammon	Read Replies (1) \| Respond to of 34857

QCOM vs NOK One final point, QCOM owns the CDMA patents. As such, NOK has to pay a royalty to QCOM for every phone it ships that has CDMA capability. This cash flows almost straight to QCOM's bottom line. We don't have access to QCOM's cost structure, and pricing model for the chip sets, yet, it is fairly easy to see that the royalty stream MAY be higher than the profits on the chip sets. Robert

To: Mr.Fun who wrote (4993)	5/27/2000 3:55:00 AM
From: tradeyourstocks	Respond to of 34857

Where do you get this stuff? <<There are very sound business reasons for not buying QCOM chips. First, every Nokia phone is built off of the same core TI DSP. This allows them to maintain an unheard of 80% commonality of parts, which in turn gives them enormous advantages in purchasing and manufacturing. This gives NOK a 10-15% cost advantage over every competitor. If NOK succeeds in implementing CDMA-One on the TI chipset, this advantage is carried over to the CDMA market. QCOM charges alot for its chipset and if NOK were to buy it the cost advantages of its business model would be obliterated.>> Do you have any idea about the real system architectures for Nokia's CDMAOne products? If they're using a stand-alone TI DSP in addition to their own Baseband/IF/RF ASIC then there is no way in hell they could be competitive with any other CDMA solution. Nokia has probably integrated a DSP core into their CDMA ASIC (that they've been working on for over 7 years). So, the Nokia CDMA ASIC still has another company's IP. Judging from TI's quarterly profits, Nokia isn't getting the core for free! In addition to a long and expensive internal development effort on the rest of the CDMA chipset, Nokia is also making TI rich. Nokia's CDMA efforts have only resulted in huge losses for the company so far. As long as the GSM cash cow is working strong, I suppose Nokia will stay this route. MicroE

To: Mr.Fun who wrote (4993)	5/27/2000 2:40:00 PM
From: JW@KSC	Respond to of 34857

Re: This is not a holy war. It's just good business. There are very sound business reasons for not buying QCOM chips. First, every Nokia phone is built off of the same core TI DSP. This allows them to maintain an unheard of 80% commonality of parts, which in turn gives them enormous advantages in purchasing and manufacturing. This gives NOK a 10-15% cost advantage over every competitor. If NOK succeeds in implementing CDMA-One on the TI chipset, this advantage is carried over to the CDMA market. QCOM charges alot for its chipset and if NOK were to buy it the cost advantages of its business model would be obliterated. Given the competition is Samsung, AudioVox and Kyocera, Nokia is not exactly scared that it won't be able to make up lost ground once it has the implementation of CDMA on TI right. Sustaining margins is just as important as building market share - ask Motorola. This is not a holy war. It's just good business. Mr. Fun I'm not sure if it makes good business sense. IMO Samim may have a point "What? do business with QCOM? We would rather eat moose dung." Good Business sense would be being able to come to market with the latest and greatest features at the same time as your competition! Not 6 months or a year down the road. Qualcomm has actually run a few competitors out of the business. Oki Electric, LG Electronics, and Sony all made CDMA chips for their phones but dropped those efforts in favor of buying chips from Qualcomm. Why? Because Qualcomm has been able to add features, like geographic-positioning circuits and MP3 music-playing capability, sooner than anyone else. What's more, Qualcomm's "chip sets" use fewer chips than those of competitors, making possible cell phones that are more compact and that need less power. It would be nearly impossible to keep up with Qualcomm, the fabless approach lets Q concentrate the company's money, energy, and 800 engineers on designing new chips, not making them. Not that Q is worried if Nokia does continue to design it's own Chips, as being fabless has paid off. Qualcomm sells 90% of the chips that go into CDMA phones. In the fiscal year ended September 1999, that translated into $1.1 billion in sales, more than one-quarter of Qualcomm's total revenues. Analysts estimate that Qualcomm will pass $2 billion in chip sales next year, with a pretax profit margin of more than 40%. And what does Nokia have to offer to counter HDR (high data rate), running speeds of 2.4 megabits per second. Fast enough do full-motion video with HDR. Oh yes 1XTREME. I'm not quite sure it will fly in the end, as it needs to be as cost effective as HDR. HDR has the support of Ericsson, Lucent, Hitachi, and others. It can work in existing CDMA networks but does require cellular companies to add costly equipment at each cell site. As a NOK Shareholder I'm all for beating the competition, but when it comes to the bottom line, profits and shareholder value are why I'm invested, and wasting Time and Money for pride is not sound business, not at this point in wireless, Nokia should be working to be the Dominate player a new wireless technology, that can surpass Q in every respect and not a battle in the current futility. With the possible acceptance of TM-UWB by the FCC waiting in the wings, effort should be spent on Creation and Innovation not fighting a losing battle because of a companies own ego. I fully understand importance of Standards and Patent Issues, as back in 1995, before 99% of the world knew what ADSL was, I was determining which Line Code was superior. By Feb. 96 I choose Amati Communications Discrete Multitone Line Code over AT&T's Carrierless Amplitude Modulation (CAP). DMT won the ITU Standard, and Amati was bought by Texas Instruments. See the SI Amati Thread. Or Why DMT for ADSL members.tripod.com I'm a shareholder of both N & Q a win win position. Nokia should strive to be Superior and Dominate in a new Wireless Standard, even a Surfer knows not to go up against a Tidal Wave. Sustaining margins is just as important as building market share - ask Motorola. You mean the same Motorola that was the Prime Contractor that designed Iridium's (now Bankrupt) Constellation of 66 Satellites, with complex onboard processing capabilities, and using a TDMA air interface with a system capacity of 1.5 billion Minutes of use per year, costing $7 billion, with a designed life span of around 5 years! Iridium had to charge $1. a minute just to cover the cost of the system. In contrast Loral built GlobalStar with 48 Satellites, (18 less than Iridium) with a 9.6 Kb per second voc vocoder, compared to Iridium's 2.4 Kb device. The GlobalStar system has better voice quality and it's CDMA soft handoff function results in a level of dropped calls under 5% comparable to the best cellphone systems. CDMA's superior designs efficiencies allow GlobalStar to support 10 billion minutes a year (that's 8.5 billion more than Iridium) , and the Satellites were designed for 10 years, twice Iridiums, with a total cost of only $4 billion. No! let's not ask Motorola. Regards, JW@KSC

To: Mr.Fun who wrote (4993)	5/27/2000 3:21:00 PM
From: samim anbarcioglu	Respond to of 34857

Fun, >> Sustaining margins is just as important as building market share At the expense of sounding didactic, you are neglecting an elementary economic principle: opportunity cost. In my career I have seen, and even participated in so many projects that have failed because of a wrong 'buy or make' decision. The following table will illustrate the lost oportunity cost: (Profit margin) * (Volume) = Gross revenue Margin percentage Volume Total ----------------------------------------------- (10%)* ($3,000,000,000)= $300,000,000 (35%)* ($0)= $0 This should clarify any haziness in your mind about the lost opportunity while trying to reinvent the wheel (which has a big chance of being out of round, given what we are observing).