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Strategies & Market Trends : Gorilla and King Portfolio Candidates -- Ignore unavailable to you. Want to Upgrade?

To: Uncle Frank who wrote (25355)	5/25/2000 12:54:00 PM
From: JH	Read Replies (1) \| Respond to of 54805

<Ericsson, Motorola, Samsung, Lucent, and Hitachi have contracted to pay qcom the same royalty rates on wcdma as they do on other cdma products> The following will be painful to read because of the numerous alphabet soup of acronyms, but it should dispel the belief that QCOM will be collect royalties on "most flavors" of 3G-CDMA. Message 13197122 In fact, the IP on many variants of CDMA are owned not by QCOM but by other individuals, and by companies like IDCC. telecomtechstocks.com There has not been one penny paid to QCOM on their version of 3G (CDMA 2000 / HDR) yet, because it's largely still vaporware. The hardware infrastructure for the spectrum of equipment needed to transmit/receive 3G doesn't yet exist. However, Samsung seems to be the first major company to announce their support for HDR, according to the news release today. Not surprising, because CDMA One is the dominant standard in Korea today. They don't really have a choice! I bet that the majority of VC capital in Korea destined for wireless devices is invested in companies developing hardware/software/applications/content for QCOM's HDR or CDMA2000 ! Sometime in 2001, 3G will become reality in Japan - spearheaded by DoCoMo. As far as I know, NTT Docomo does not, and won't be paying QCOM any royalties on their proprietary version of CDMA. <Why are you defining Nokia as a telecom? They are a wireless equipment manufacturer selling to telecoms.> The evidence suggests that the "tail" (mobile phones) is wagging the "dog" (telecoms). Believe it or not, the popularity of Nokia telephones (largely GSM) has greatly helped the establishment and leadership of GSM as the leader in moblile standards. Ericcson, which was once a mobile equipment maker, has largely disappeared from this market because of the success of Nokia. My point is that Nokia is in an enviable position to influence the flavor of 3-G largely due to their dominance of mobile handsets. If for example, Nokia decides to push their support behind one of the "non-QCOM" ITU 3G standards, the telecom companies will need to jump on that particular "flavor". That is why Nokia is putting money with IDCC to develop a "non-QCOM" variant of WCDMA. It would be sweet for Nokia if they can rule the telecom equipment market by adopting a flavor that Ericsson does not yet build. Read about the "cat-and-mouse" game being played in this arena TODAY, with respect to 2.5G (GPRS and EDGE)... Message 13024934 Message 13027439 <In reality, the analysis I've seen indicates carriers must pay larger royalties on gsm products than on cdma products.> That may be the case today, but 3G is the mother of all markets. The recent auction held in UK for 3G bandwidth was won by a couple of companies at prices which will probably never return a profit. Hence, licensing fees for the different 3G "flavors" will definitely be an important variable for price-sensitive mobile operators.