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To: Dealer who wrote (27559)	8/2/2000 5:34:03 PM
From: candide-	Respond to of 35685

Hi all, from the Bull Market Report: QUALCOMM, IS IT GOING ANYWHERE? by Scott Pelton, Contributor, The Bull Market Wireless Investor After a number of forward-thinking ventures and partnerships, the question appears to be a valid one. Qualcomm ($63, down 2) announced last month a venture with In-Flight to provide product development for a full-function in-flight Internet and email service. With modifications to existing Qualcomm CDMA (Code Division Multiple Access) technology, the service promises to provide users with an initial 200kbps connection, and speeds up to 800kbps later. While the service may be beneficial to travelers, especially 'air warriors', it may not do much for Qualcomm's bottom line. The same is true to some degree with the recently announced joint venture with Ford. Qualcomm announced it will supply key technical aspects for the new wireless automobile venture, but the market for this product is potentially much more significant. General Motors already offers an on-car satellite navigation system, and anticipates 1 million customers by year-end. Ford is expecting to reach those numbers by year-end 2001. The market for suppliers to this new automotive niche is huge, and Qualcomm could benefit greatly. Although Qualcomm's stake as partner is unspecified, the company could play a big role in the future of wireless in-car Internet services. Ford is looking to keep pace with GM, hoping to reap the benefits of providing Internet service via monthly recurring charges. COMMENT: This is exciting news for those of us who are tethered to our computers, but what does it really mean for the stock? A couple of recent events may not bode well for the company. With Qualcomm firmly entrenched in second-generation wireless, it's important to note that the company also has a leg up on third generation standards. There are now two competing standard platforms for wireless service, CDMA2000 and W-CDMA. Close examination shows that Qualcomm is much stronger in the CDMA2000 arena than in the prime standard of W-CDMA. And it is still unclear which is going to win. If W-CDMA wins, Qualcomm will have its work cut out for it if the company hopes to effectively compete and gain market share. On the international front, Qualcomm has had a couple of hard knocks in Asia, with China and Korea both opting not to use the company's CDMA standard. It is still uncertain how those two big players are going to affect the market, and Qualcomm in particular. Add to that the general uncertainty of the market, and the new-found mantra of fundamentals, fundamentals, and fundamentals, and it may take more than irrational exuberance to move the stock forward. A couple of numbers do look quite positive for the company, including its profit margin (5.1%) and return on equity (19.6%) compared to the industry. If you have it, hold it; if you don't own it, you might consider adding a small stake in the company, though short term we expect to see continued price pressure. Longer term prospects looks good, but don't expect a 2000% run-up over the next 12 months, like last year!