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Technology Stocks : Qualcomm Incorporated (QCOM) -- Ignore unavailable to you. Want to Upgrade?

To: EepOpp who wrote (75750)	7/7/2000 5:33:55 PM
From: S100	Respond to of 152472

Best post I have seen today. boards.fool.com Many professionals today are legally liable for performing their professional work in an accurate and knowledgeable way. Doctors and lawyers get sued for malpractice; stockbrokers have to be very careful how they dispense financial advice; architects and homebuilders warrant the structural integrity of a home; the list goes on. The press, however, seems immune from this liability. They report news in a distorted way, mostly resulting from not understanding what they are reporting. The headline on CNBC, repeated many times this morning, is "Qualcomm loses Korean market to a competitive technology." I'm sorry, there ought to be a law... W-CDMA was put together by a European consortium but the technology is not owned by them. The fact of the matter is that W-CDMA is based primarily on QCOM intellectual property and QCOM will receive its royalties whether the technology utilized is CDMA 2000 or W-CDMA. This is not a matter of ownership of technology. It is a matter of sponsorship...QCOM sponsors CDMA2000 while the Europeans and DoCoMo sponsor W-CDMA, but both are based on QCOM IP above all other IP. But QCOM is not simply a royalty company. Their future is directly tied to their success in the ASIC business. To think that W-CDMA is Nokia/Ericsson/DoCoMo technology and that QCOM will be out of their league in designing ASICs for that version of 3G CDMA standard is just plain ludicrous. Nokia has tried for years to design 2G CDMA ASICs with little success, leaving 90% of the market to QCOM. Since there is no W-CDMA today, and thus no factual backup, QCOM detractors spread the fear that QCOM will be displaced from the ASIC business (as they report, it's not QCOM's technology!). In the end, however, the chances that QCOM will not come to dominate the W-CDMA ASIC business when it becomes a business are negligible. I repeat, W-CDMA has mostly QCOM IP at its foundation; QCOM has the majority of the CDMA engineering talent out there; the sponsors of W-CDMA have proven decisively that they can't design competitive CDMA chipsets. W-CDMA "belongs" more to QCOM than to its sponsors in the sense that QCOM is the likely main beneficiary of its deployment, except of course in the handset business where QCOM does not compete. It's quite possible that CDMA2000 is better for QCOM chipset business than W-CDMA, but it's all a matter of degree. The news out of Korea is NOT a defeat for QCOM technology. QCOM "technology" is its IP and its CDMA design expertise. Both W-CDMA and CDMA 2000 use this "technology." W-CDMA might not be as resounding a victory as CDMA2000 in terms of bottom line for QCOM, but one must keep in mind that CDMA market share in worldwide 3G networks will be multiples of the CDMA market share in 2G networks. Thus, the fact that QCOM doesn't get everything going their way with adoption of their preferred version of CDMA will be minor compared to the bonanza created by virtual worlwide adoption of CDMA in general. Now, it seems like many or most major markets are embracing W-CDMA, creating a snowball effect in the sense that nobody wants to deviate from what may be becoming the standard. Part of this snowball effect is created by the sponsorship I described above; very important wireless players are supposrting W-CDMA, and, much like the PC business, sponsorship will have a lot to do with what emerges as a standard. QCOM feels CDMA2000 is better but technological superiority alone will not win the battle. Is QCOM better off sponsoring W-CDMA as well to avoid the issue of W-CDMA and CDMA2000 being characterized as competing technologies when they are really not? I don't know the answer to this question, but I do sense that W-CDMA is winning the standard battle and QCOM's sponsorship of CDMA2000 is giving the press room to report all sorts of inaccuracies. I do know this...freedom of the press is being misused. It's getting confused with professional integrity and it's giving the press the ability to perform their professional duties without any of the liability that the rest of us face in carrying out our professions. --fox

To: EepOpp who wrote (75750)	7/7/2000 5:37:25 PM
From: jmac	Read Replies (2) \| Respond to of 152472

Much of the enthusiasm for QCOM in December, 1999 was momentum players and hedge funds jumping in for no reason at all but to jump on. It had nothing to do with the fundamentals of the company. The market has changed in just the last 6 months. I don't believe you will ever see a run for a company like you did for QCOM again (although RMBS sure went fom the mid 50's to the 100 range (excluding intra-day blips) in a very short time.