Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

To: JohnG who wrote (10993)	5/29/2000 11:34:00 AM
From: slacker711	Read Replies (3) \| Respond to of 13582

Here is another account of the Korean royalty situation.... Foreign IMT-2000 Players Waging Price-Cutting Wars for Royalties By Yang Sung-jin Staff Reporter As the Ministry of Information and Communication is getting ready to decide the IMT-2000 business license screening method, foreign solutions providers are waging a price-cutting war on royalty rates to grab the initiative in the country's wireless market. Foreign IMT-2000 patent holders such as Qualcomm, Nokia and Ericsson are hinting at lowering the royalty fees for the next-generation wireless communications technology under the assumption that beating the competition matters most at this stage. According to ministry officials, Ericsson visited the ministry headquarters last week and expressed willingness to set the royalties for core parts for IMT-2000 devices to below 5 percent in a bid to offer competitive conditions for Korean manufacturers and service providers. Earlier this month, Ericsson expressed its determination to carve out a share of the IMT-2000 market in Korea where the huge mobile phone user base will lead to a greater market once the next-generation IMT-2000 service is commercialized. Ericsson said it was seeking local manufacturers as partners to sell its IMT-2000 systems and solutions, expressing its willingness to transfer core technology to the country's emerging third-generation (3G) market. Ericsson is currently in talks with Korean manufacturers and mobile operators to share the IMT-2000 technologies and solutions in an attempt to outdo other foreign and Korean players in the wireless solutions market. Another European mobile phone player, Nokia, also revealed its position that it will offer lower royalties for the IMT-2000 technologies compared with Qualcomm's current arrangement. However, ministry officials said Ericsson and Nokia's positions were not that satisfactory since Korean mobile phone service operators and manufacturers are paying 5.2-5.7 percent of the total revenue as royalty fees. To stay competitive in a showdown with Qualcomm, European players should lower the rate to below 4 percent, ministry officials said. Meanwhile, the ministry is considering encouraging Korean handset makers to stage joint negotiations with foreign solutions providers to secure lower royalty rates. Qualcomm, which backs up the CDMA (code division multiple access) technology for domestic mobile phone services, is also racing to defend its position in Korea's next-generation wireless communications market. In mid-June, Qualcomm's top executives will visit Korea to explain the U.S.-based company's position on the royalty issue while Erisson and Nokia are known to have a plan to discuss the issue with ministry officials earlier next month. The price-cutting war for the controversial royalties comes at a time when the IMT-2000 standardization issue is mired in disputes and uncertainty with the parties concerned voicing different stances. Top ministry officials said the IMT-2000 standard would be finalized after the ministry reviews a number of key factors, including royalty rates, international roaming availability and technology transfers.