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Technology Stocks : Qualcomm Moderated Thread - please read rules before posting -- Ignore unavailable to you. Want to Upgrade?

To: Dennis Roth who wrote (173)	7/3/2000 8:29:35 PM
From: Maurice Winn	Read Replies (4) \| Respond to of 197451

<If there are 17 patent holders demanding royalties totaling 15% for a GSM handset and ther is only Qualcomm asking for 5.2% for a cdmaOne handset then you can see why GSM has such an effective lobby. Their are at least 17 patent holders lobbying for it verses the Q. A dual mode GSM/W-CDMA handset could easily have royalties running to more than 20% before even considering the Q's IPR. Hence, with several dozen companies hoping to get royalties out of ESTI/NTT W-CDMA, it's all of them and their propaganda machine and their governments verses the Q. Also with most of the royalties going to Europe and maybe a billion cell phones to be sold in the next few years, you can see why it is such a big thing for the Europeans. We're talking potentially tens of billions flowing to Europe for IPR. CDMA 2000 means 5.2% royalities going to San Diego, not Europe which is why the Euro's make such a big deal about Qualcomms royalties but never mention the 15% Taiwanese and Korean GSM handset makers have to pay.> Dennis, the answer is to price W-CDMA off the market! Q! should raise royalty rates to 100% of the wholesale price of subscriber devices. That would force service providers to lower their bids for 3G spectrum to a few $$ million rather than many $$$billion. That would also force them to scrupulously analyse just which technology will provide the most efficient and profitable technology. That would also reduce the ability of governments to arbitrarily support W-CDMA and other absurd technology. At the moment, governments are being thrown $$$billions for no good reason. Those $$$billions should go to the company which created the huge value in spectrum efficiency and functionality and time to market. That company is QUALCOMM. The price of royalties is the value of the technology to customers. The value of CDMA has been dramatically rising for the past few years and now it is obvious from spectrum auctions that it has been grossly and absurdly undervalued. Nokia had better be signing before Q! realizes just what pricing power they have! Already Q! has pointed out that new royalty rates will be higher. I think some just took that as bluster. It's not bluster; it's obvious and the "higher" will be eyebrow-raising and jaw-dropping higher. The limit on royalties is the value subscribers place on the technology, which is determined by the service providers such as Vodafone and expressed through their bids for spectrum. The next auction for 3G spectrum is to take place in New Zealand in a very free market, with GSM, TDMA and analogue all competing now. That will give a different guide to spectrum value in a less crowded, lower income country than the UK. Mqurice PS: The USA will strongly support Q! in this with all the power of the judiciary, executive, Congress, Senate and military. The $35bn which will go to the UK government should go to Q! If Q! receives that payment, the USA government would tax it and receive a VERY BIG payment. Q! is like a black hole, based in San Diego, sucking taxes from all around the world as the world moves to a WWeb way of life. The USA will support Q! Why on earth should the New Zealand, British, German, Chinese and other governments collect money for spectrum efficiency which belongs to the creators of the amazing CDMA technology and the government which protects them and their property? In New Zealand, we now have the unedifying spectacle of apartheid tribalists who believe in cargo-cult technology being offered quarter of the 3G spectrum at a 5% discount. It's a lolly scramble which is causing conflict as the bush babies in NZ fight over the profits which belong to Q! and the USA government. It's immoral that Q! doesn't charge the full price for the technology for the benefit of Q!, the USA and, of course, ME!! Let's have more hegemony and less of the Independence Day nonsense.

To: Dennis Roth who wrote (173)	7/3/2000 8:56:15 PM
From: foundation	Respond to of 197451

Dennis - A very thoughtful analysis. However, as I read through your post, there is no mention of time to market issues for the various technologies, and resultant ramifications. Do you perceive that wCDMA, GPRS, EDGE will be developed and ready to roll out in a similar time frame with 1x, CDMA 2000, HDR? It is my understanding, from news releases, that an optimistic rollout for wCDMA is 2002, with some suggestions of 2003 (and this from supporters). I understand that Edge is well away from functioning as well. I suggest, that if this is the case - that CDMA will have a time to market advantage - that the Asian playing field that you describe will be turned on its head. How will a Korean telcom capture customers with NTT's wCDMA, if NTT's flavor doesn't exist concurrent with its competitors offering CDMA 2000 level services? Why will Korean telcoms pass on CDMA 2000 in order to wade into the wCDMA IPR swamp (again, after waiting until it exists), where they will be at a distinct disadvantage as you pointed out, when they have the opportunity now to, along with DDI, define the Asian standard, with a superior QCOM IPR rate advantage to later licensing European players? With even a successful rollout of 1x in Korea and DDI in Japan, how does the wCDMA Asian house of cards remain standing? Regarding strategy, I can see Korean telcoms playing the wCDMA "chip" well into the future in negotiations with CDMA equipment suppliers, as well as QCOM. There is nothing for them to loose in this gambit. They won't really have committed to a thing. And, as you noted, this will be a short term public relations coup for wCDMA. Dennis - how do you see time to market issues effecting this Asian game? Thanks, blg