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

To: laodeng who wrote (8371)	3/9/2001 4:08:30 PM
From: laodeng	Read Replies (2) \| Respond to of 196499

Chinese link: www2.gotrade.com.cn Mightylakers, proof-reading please. laodeng

To: laodeng who wrote (8371)	3/9/2001 4:51:00 PM
From: seahorse	Respond to of 196499

License fees were interesting. Anyone have any thoughts on how Q could police what is sold within China and what is exported?

To: laodeng who wrote (8371)	3/9/2001 4:59:46 PM
From: gdichaz	Respond to of 196499

laodeng: What is fascinating to a watcher from "away" such as myself is the power that the "old guard" maintain at MII backed by the European "old guard" - the GSMers. How is it that the central politcal leadership seems unable to have any impact on the entrenched interests in MII? A puzzlement. Best. Chaz

To: laodeng who wrote (8371)	3/9/2001 6:16:29 PM
From: mightylakers	Respond to of 196499

laodeng, what a great job you did. I can't think of a better translation. Now I wonder what the Koreans will do in trying to convince Chinese that they are not really supporting WCDMA<ggg>

To: laodeng who wrote (8371)	3/9/2001 6:25:24 PM
From: carranza2	Respond to of 196499

Thanks for that terrific translation. Anyone notice something? Nokia not mentioned. Since the domestic Chinese handset manufactureres appear to have a local cost advantage because of the reduced royalty, looks like Nokey is going to have a competitive problem in China.

To: laodeng who wrote (8371)	3/9/2001 6:27:47 PM
From: LarsA	Respond to of 196499

Thanks laodeng! eom

To: laodeng who wrote (8371)	3/9/2001 8:11:51 PM
From: Ibexx	Respond to of 196499

laodeng, Thank you so much for your efforts in translating this lengthy article - and all the others before it! I have a couple of questions and would like to hear your thoughts: 1. Do you expect the "bidding" to be an open process - relatively speaking, of course - based on technical merits and business acumen of the bidders? 2. Would you speculate that Qualcomm may play a role in selection of bidders based on your observation of past Chinese governmental practice in similar areas? I am also curious as the royalty rate Q* has granted China. I always thought the royalty percentage is a fixed number, not a range. Looks like I was wrong. Any "rumors" as to what the "minimum" number might be? Ibexx

To: laodeng who wrote (8371)	3/9/2001 9:46:30 PM
From: cfoe	Read Replies (3) \| Respond to of 196499

I want to add my thanks to you for your efforts here. I did not notice any mention that requires use of QCOM's ASICs by Chinese handset manufacturers or a contracted price for QCOM ASICs. However, I remember that in some previous post that Chinese would use QCOM ASICs and get a favorable price. Now that I write this, it may have come from a PM sent to me many months ago quoting a knowledgeable person (who is no longer posting as far as I know). Anyway, did you come across any mention of QCOM ASICs? Also, I will take the royalty and infra numbers mentioned in your translation and see if I can arrive at what it might mean to QCOM's eps this year.

To: laodeng who wrote (8371)	3/10/2001 2:43:22 PM
From: A.L. Reagan	Respond to of 196499

Laodeng, your post and excellent translation have me veering towards cheerleading status again <g>. Thank you very much for sharing news which no major WS analyst (that I know of) has yet picked up on. My only concern is that since QCOM has typically entered into "most favored nation" royalty agreements with the major licensees, existing licensees may be entitled to a rate reduction based on the lower rates to Chinese manufacturers. HOWEVER, this is mitigated by two factors: (a) the lower rates only apply to IS-95A; and (b) the territory is apparently limited to mainland China. The article you translated stated The license fee for Chinese manufactures are: System equipment will be charged at about 2% on the net sale price, handsets will be charged at about 3.5%. The license fees charged on foreign firms is about 6% or higher. However, the lower license fees are only allowed for Chinese firms to sell CDMA equipment inside China. If any firms sells products to other regions, they must re-negotiate new license agreements. I do not believe that QCOM will be able to charge foreign firms a higher rate on ID-95A handset sales in China due to the following "typical" royalty agreement language: if QUALCOMM grants a license to a third party to manufacture and sell Licensed Products at a royalty rate less than the royalty payable by LICENSEE to QUALCOMM, and, which license will permit such third party to manufacture and sell Licensed Products for use within the scope of the license granted in this Agreement, QUALCOMM shall (i)promptly notify LICENSEE of such license, and (ii)extend to LICENSEE the lower royalty rates applicable for the territory granted in the noticed license and, at QUALCOMM's election, any or all other terms and conditions granted (whether more or less favorable than the other terms and conditions granted under this Agreement) with respect to the third party license effective as of the date on which they became effective in the third party license. So, I am wondering if there is a potential political problem down the road if (i) the Chinese manufacturers think they are getting a special deal for their domestic market that awards a cost advantage against "foreign" firms; but (ii) down the road the Samsungs and Nokias who want to sell IS-95A phones in China end up getting the same rate. Possibly QCOM has figured out a way to overcome the issues in existing royalty agreements, but if I'm Samsung, and read laodeng's article, Monday morning I'm demanding the 3.5% (versus 5.5%) on IS-95A handsets sold into China. Now, it may be that there are very few licensees with a territorial addendum permitting h.s. sales to China. Dunno. Anybody know the main h.s. supplier(s) to the old Great Wall system? Was it MOT, which already had a lower rate on IS-95A? And then there is the entire policeman issue of tracking where handsets are ultimately sold in order to calculate royalties at different rates for different territories. While I'd venture a guess that QCOM does have the bases reasonably well-covered, I can see how the FUDsters could make some hay out of this situation.