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Technology Stocks : Nokia (NOK) -- Ignore unavailable to you. Want to Upgrade?

To: tero kuittinen who wrote (7572)	10/14/2000 1:07:13 PM
From: foundation	Respond to of 34857

With the passing of 2G, GSM dies. Perhaps Tero's soul dies as well? IMT-2000. The OHG. An imminent CDMA-centric world. Operators' profound dissatisfaction with the GSMA grows - as they attempt to delay their demise at the expense of Operators' interests. Delaying 3G to pump and pimp as many 2G handsets as possible before the inevitable end. Before they must compete without a spoon-fed, sweetheart market. Pathetic. And futile. Will the Nokia lumberjacks return?

To: tero kuittinen who wrote (7572)	10/14/2000 1:20:27 PM
From: slacker711	Read Replies (1) \| Respond to of 34857

Would you claim that January-April trends are more important than April-August trends? I wouldn't. Last winter's growth patterns are history. The April-August period is crucial precisely because it is totally different from the January-April period. These trends are only analyzable if you actually attempt to look at the underlying reasons for the numbers. During the period you cite as "crucial" the Korean sub base DECLINED by over a million subs. Do you think this would have occurred without the banning of handset subsidies? If you are going to make a long-term argument based on the numbers...you are going to have to do a little more analysis. Unless you believe that Korea will continue to lose a million subs a quarter..... It seems you are trying to make the case that long-term TDMA growth will outpace CDMA based on the fact that TDMA is outgrowing CDMA in North America and Latin America. I dont think you have the numbers to back you up. Here are the numbers from the UWCC website.... uwcc.org “TDMA-EDGE continues its dominance in the Americas reaching 24.6 million in the North American region, representing a 75% increase over the past year,” stated Chris Pearson, UWCC Executive Vice President. The most explosive growth continued to take place in the Latin American region, reaching 20.5 million, which represents a 123% increase over 1999. The comparable numbers for CDMA are 118% YoY growth in the US and 342% for Latin America. Of course then you will site the fact that sequential growth is more important than YoY growth. Here are those numbers....This is from UWCC first quarter release. uwcc.org TDMA-EDGE currently serves over 22 million subscribers in North America and almost 17 million in Latin America. This means that TDMA experienced 11.8% QoQ growth in North America and 20.5% in Latin America during the second quarter. The comparable numbers for CDMA are 24.9% QoQ in NA and 33% in LA. All CDMA numbers are from the CDG... cdg.org Mexico and Brazil are the keystones of TDMA's current performance. Not very solid keystones based on the above numbers.... I guess you can always shift to a third argument that the situation changed profoundly over the summer...perhaps it did. If so, I would like to hear WHY? Time to show me the numbers.... Slacker Oh yeah....welcome back <g>.

To: tero kuittinen who wrote (7572)	10/14/2000 6:06:08 PM
From: EJhonsa	Read Replies (2) \| Respond to of 34857

People can discuss about 1XRTT, GPRS, HDR, cdma2000 and W-CDMA on this thread until the cows come home. What drives the industry sales during the next 6 months is going to be the boring, plain vanilla 2G sales. Tero, ever read "The Clouds" by Aristophanes? Well, if you haven't, the story's basically a satire of two diametrically opposed schools of thought in Greek culture, known as Sophistry and Right Reason. Adherents of Sophistry, as their name might imply, spent their days cooped up in dark rooms, doing nothing but philosophizing in a wistful manner and living a semi-decadent, purposeless lifestyle. Those who believed in Right Reason, on the other hand, were obsessed with self-discipline and self-denial, and rigidly followed the dogma that they were taught by their elders. What Aristophanes was critical of, of course, was how destructive it was to follow either one of these schools of thought to their logical extremes. The same holds true here, as it's quite obvious that two contrasting analytical approaches have taken flight here, one focused on near-term company/financial occurances, and one focused on long-term technological trends; and once again, the problem comes from not finding a middle ground. I'm not going to argue that short-term events don't matter. A dollar earned in 2001 is no less valuable than a dollar earned in 2004 (perhaps it's more valuable, due to the fact that inflation and risk have to be factored in more when looking at earnings further out). Likewise, I'd agree that it sure wouldn't help a company's long-term R&D budget, sales/marketing clout, economies of scale, or brand (the last of which matters if it's a consumer-focused company) if its business were to do horribly in the near-term, but is counting on success a couple of years from now to make up for it. So, yes, the short-term does matter tremendously, and if you see some of the posts that have been written here as of late, both by myself and by others, many of them have related to short-term industry trends. This board hasn't quite yet turned into a Gilderesque forum for futuristic daydreaming. But my guess is that the end goal of those who are here isn't to discuss short-term trends, long-term trends, or any sort of industry trend in and of itself. Rather, it's to make quality wireless-related investments, with the analysis of different types of trends only acting as a means to this end. Now, with this kept in mind, the next thing you have to focus on in is valuing a potential investment, as all other fundamental analysis flows from asking that question. As I'm sure you know, a company's generally valued by projecting its discounted future long-term cash flows. In this statement, the word "long-term" can't be stressed enough. A company that has $2 billion in assets, and is expecting to earn $4 billion in the upcoming year on 300% annual growth won't be given a P/E of even 2 if it isn't expected to earn another cent after that year's up. Likewise, if I was invested in Intel, and if on Monday, AMD announced that they'd developed a 300 Ghz. processor based on quantum computing that could be manufactured for $10 by a 6-year old in a Malaysian sweatshop, with the only catch being that the processor won't be ready for another two years, do you think that I'll bother caring about how the PIV will stack up against the Mustang in 2001? Hell no, I'd sell every share of Intel that I might have, and quite possibly reinvest that money in AMD (note: I'm not trying to create any real-life analogies or parallels here). I'm sure that a number of analysts and fund managers would do the same thing. In the end, the shareholder value delivered in the two years before the new AMD chip is released is far less valuable than the value that might not be delivered in the following decade or so, and thus the long-term problems far outweigh the potentially bright short-term outlook. But before you take this the wrong way, I'll mention that I did read the part of your post which talked about the importance of thinking long-term, and I'm not accusing you of only focusing on short-term trends. However, you also wrote: In this environment, "Just you wait until 2003!!" does not cut the mustard with investors. People in this thread have done a great job of ignoring the 2G market while shifting the focus to 3G. I doubt the markets will be as nobly far-sighted if they detect 2G sales weakness going into the fourth quarter. What I take this to mean (correct me if I'm wrong) is that regardless of how promising the future is for a company, people won't care for it if it isn't doing well short-term. In other words, in such cases, you'd be counting on investor ignorance to make a company's long-term potential irrelevant to the performance of its stock price in the near future. While such a mentality might potentially save some short-term anguish, applying it can also carry some significant risks in both directions. In the past couple of years, I've seen a number of companies, such as 3dfx and several retail clothing firms, have their shares get hammered even while they're putting up tremendous growth due to the fact that the market was able to see clouds on the horizon. Likewise, I've seen shares of companies like Rambus and Gemstar soar into the stratosphere, never to fully return to Earth, the moment that Wall Street got wind of the given company's future prospects, even though these prospects were hardly reflected in their near-term fundamentals. Many of those who took a wait-and-see, short-term-focused approach in these circumstances, both for the former and the latter types of companies, ended up seriously regretting their decisions. Eric PS - Speaking of the short-term, I'm interested in seeing what response Nokia has to the Siemens SL45 and Ericsson R380. I think that a 90g MP3 phone with an in-built voice recorder just might have some appeal with the teenage/college/yuppie crowd, and that a PDA phone with a pen-based interface that doesn't require a seperate attache case to carry along might be popular with some business users.

To: tero kuittinen who wrote (7572)	10/15/2000 1:16:48 PM
From: Eric L	Read Replies (1) \| Respond to of 34857

Tero, Welcome back! I hope you're not just "dropping in". It's nice to have you in fine, fighting, fettle. It has been very difficult trying to keep my respected fellow Qheads from trampling all over this thread in your absence <g>, particularly in light of Nokia's less than spectacular performance of late (which you nicely explained before going walkabout). << a little disingenuous to say that TDMA being the fastest growing digital standard is "not a long term trend". >> It is NOT disingenuous and it is NOT a long term trend. << Thanks for not trying the tired old "It's just Korea" angle >> Oops! did I forget to mention that? Did you forget to mention it in your article which emphasizes exactly the months this "angle" impacts? The double whammy out of Korea (longer than normal subsidy ban, and mandate to SKT to reduce subs below 50%) have been crippling, and subscriber adjustments made this quarter at Sprint PCS certainly have mot helped, but this bodes well for Q4, and I expect exceptional numbers out of both Verizon and Sprint PCS to close the year. The "trend" will not reverse until Korean subsidy bans are lifted and SKT gets to 50%. << It wasn't supposed to be any kind of a trend during the year 2000, remember? This was the year when TDMA growth was supposed to stall as subs defect to IS-95 operators. You were one of the people who bought into this prediction. >> I don't think you can find a post of mine that says that, here or on any other thread. TDMA & CDMA growth here and in LA is coming at the expense of analog as I have maintained it would. Churn is moderate in both camps. You also will not hear me projecting that Cingular will choose cdmaOne/cdma2000 for their NA GSM or TDMA properties (LA of course a different matter both potentially and actually) or that AT&T will alter their commitment to implement TDMA-EDGE on a nationwide basis. I am on long standing record to the contrary. << And now you're shrugging the stellar TDMA growth off by saying that it's not sustainable, anyway >> TDMA is only slightly exceeding consensus (and UWCC) forecasts. GSM, however, is well exceeding forecast, but one must remember that EMC always "sandbags" that one (as we say in golf). I am going to step back here, and reference yet one more time, the forecast prepared by Volpe, Brown, Whelan, for CDG and presented by Terry Yen in April of this year. Forecasted CAGR for the 5 year period ending 2004 end was projected as: AMPS = -13% _PDC = +8% _GSM = +33% TDMA = +56% CDMA = =60%* WCDMA = unforecasted * no China subs projected in this number These numbers are pretty much in line (on mean) with numbers out of In-Stat, Gartner Group, and Strategis, although Strategis and In-Stat really on are opposite ends of the scale about overall subscriber growth and handset sales. I think these numbers are pretty realistic with these exceptions: - PDC growth looks high. I think growth will be negative, and AMPS could be a larger negative than shown. - GSM could be marginally higher and TDMA marginally lower based on the recent ANATEL decision on 1800 MHz spectrum that other LA countries could emulate. << Paging Dubya - how evasive and dismissive can you get about clear statistics? SMS to Tero - how abusive of statistics do you want to be in print over a short slice of raw uninterpreted data ("clear statistics")? That would be like me saying that Nokia is a bad investment because they are down 34.4% since end of Q2 (without pointing out that they are up 43.5% for the last 12 months and explaining some of the reasons that they are now significantly down YTD). Despite the fact that IS-136 TDMA had a good head start on cdmaOne in the US, even more in Canada, and yet more in LA, This statistic speaks for itself: CDMA = 72.0 subscribers TDMA = 54.3 subscribers CDMA total subs exceeded TDMA for the first time in Q1 1998, and with the exception of a few quarters since, the gap has continued to widen each quarter. Please also note that through Q2 end CDMA grew faster than TDMA for the previous 12 month period. We have EMC estimates for Q3 but no audited actuals from them or the associations. It is entirely possible that for the calendar year TDMA may outpace CDMA, but we won't know this officially till next March or April when CDG &UWCC post actuals, and in this increasingly "prepaid" world, it is unclear to me how, when, or how uniformly, carriers adjust subs. "Net adjusted subs" also is difficult to get inside for the CDMA & TDMA carriers in the Americas, because of the large remaining base of AMPS only customers. If in any quarter, 4 million subs convert their analogue only service to digital or analog/digital without churning carrier, digital net adds are up 4 million, analog down 4 million, but carrier net adds are of course zero. << Your numbers of year-to-date growth patterns of digital standards show exactly why it's important to highlight the summer figures. >> From my perspective the total of Q4 & following Q1 are much more important than Q2 & Q3. Q4 is of course the season and adjustments are made most heavily in Q1 although some carries to Q2 and we just saw Sprint PCS adjusting Q3. I'll remind you again that EMC's numbers for Jul/Aug are estimates. I do consider their subscriber statistics and database to be the most sophisticated (and widely used) in the world. They are not infallible. I have had several discussions with Julian Herbert on that subject at the annual GSMNA conference. Also, there "pipe" to the GSM carriers and GSMA is direct, and their pipe to the UWCC & CDG is indirect. << Trying to highlight the role of Los Angeles in TDMA growth is absurd >> LOL! I did not mention Los Angeles. LA = Latin America. << Mexico and Brazil are the keystones of TDMA's current performance >> They absolutely are. And cdmaOne doing quite nicely there as well. To be sure, LA growth overall, is running well ahead of forecast. I'd be curious to hear your thoughts on how the ANATEL spectrum decision will impact on TDMA growth in Brazil? The gap, however continues to close in NA and within the next 4 to 10 months CDMA subs will exceed TDMA in NA. Come back at me if I miss calling that one. Speaking of NA, most research agencies are projecting that CDMA will represent +50% of the NA subscriber base by 2003 or 2004. I say 2004. What does your crystal ball say? << You can't shrug off the fact that all of the long-term standard growth projections will be rewritten before this year is over >> They will certainly be tuned up. Hopefully there will be enough direction out of China (and LA) to do this intelligently. I have always considered China to be a wild card, but despite all the contradictory information flow, for the first time, it looks to me like China Unicom will indeed adopt narrowband cdmaOne/cdma2000 in existing spectrum. The UWCC's recent presentations to Chinese SDO's and carriers aside, I do not expect TDMA-EDGE to be implemented in China. As I pointed out to you earlier this year, I think your gloating over the confusion of March and April re cdma adoption in China was premature. Those posts should be fun to look back on a few years from now (or maybe this one will) <g>. << You're talking about WAP phones when I'm talking about global market share shifts. Planet Earth to Eric - WAP models do not define the global market shares in mobile telephony during the second half of the year 2000. The flip side of betting big on WAP phones during this autumn seems to be the absence of appealing, new non-WAP models. >> Planet Earth to Tero: Is that your excuse for the lack of WAP enabled phones in GSM land from Nokia and Ericsson? The carriers have a different perspective on that, methinks. I'd like to see you tell that one to Chris Gent, Jim Healy, Bob Stapleton, or George Schmitt face to face. Amongst the Big Three. Nokia is the only handset manufacturer that does not have a WAP enabled handset in North America. CDMA WAP handsets are plentiful, and Motorola has several models. Ericsson & Mitsubishi have WAP enabled TDMA/CDPD handsets, but Nokia does not have one. GSM of course is the primary technology that Nokia services and Nokia was a founding member of the WAP Forum, so it really surprises me that Nokia (to the best of my knowledge) does not have a single WAP GSM-1900 handset in play in the United States. PacBell (Cingular) is using the Motorola V2282 for their new "My Wireless Window" service, but VoiceStream has been left hanging out to dry. On April 3 VoiceStream announced: Nokia and VoiceStream Wireless Corporation, the largest GSM operator in the United States, have signed a multi-year agreement estimated to be worth more than $500 million. The supply agreement will enable the major expansion of VoiceStream's GSM 1900 network and services, and bring WAP-based mobile Internet services to consumers. Where's the beef? << The market for non-WAP phones is hot. Moving the company emphasis on a new technology too early is just as damaging as moving it too late >> New technology? Too early? The decision by GSMA to use the WAP microbrowser over the Geoworks OS and microbrowser was made in May 1997, and GSMNA (and Nokia) had a lot to do with that decision. Maybe Nokia should use phone.com's UP browser instead of their own? Right now I suspect that VoiceStream (and several European carriers) are glad they made the decision to adopt microbrowser on SIM as an alternative or supplement to the WAP enabled phone. SMS, in an of itself (G-Mail), does not have super appeal on the consumer (as opposed to business) side here in NA. << People can discuss about 1XRTT, GPRS, HDR, cdma2000 and W-CDMA on this thread until the cows come home >> I think you are the thread participant who has waxed most eloquent about GPRS, are you not? Slipping isn't it? Looks like IS-95C will launch ahead of GPRS as many on this thread projected, and at considerably higher data rates. Jean-Francois Pontal of France Telecom was pretty vocal about impact of the delays in the 09/07 article posted here. The handset market share of each of the Big Three dropped worldwide last quarter. I suspect they may drop again in this quarter and the one that follows. What are your thoughts on this, at least as it applies to Nokia? The 7110 for all its nice features, must be somewhat of an embarrassment for Nokia, given their focus on, and commitment to, Quality (which is one of the reasons I held NOK as long as I did). BTW: I am glad to see two new Nokia models reappear in Verizon stores, even if not web enabled. Again, glad to see you back, and hope you check in often, please. - Eric -