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

To: Stock Farmer who wrote (103646)	9/3/2001 11:20:29 PM
From: arun gera	Read Replies (1) \| Respond to of 152472

>>I don't know of many successful commodity businesses that have obscenely profitable intermediaries in the value chain. I don't know of many commodity business that have anyone obscenely profitable anywhere in the value chain. Not for long. >> How about chip making is a commodity business but AMAT, an equipment provider for the chip makers still has good profit margins? Don't the "arms dealers" win in every war? Airlines may be commodity business, but making jet engines can be pretty profitable for GE and United Technologies. You say that companies use Microsoft because end-users ask for Microsoft. But did the end-users ask for Cisco routers? How did Cisco become successful? Arun

To: Stock Farmer who wrote (103646)	9/4/2001 12:29:42 AM
From: Dennis O'Bell	Respond to of 152472

Some of your arguments seem to center on Qualcomm being another commodity (like pork bellies or something), as if they're a one trick pony just resting on patents done in the past. While it's true that profiting in many of the commodities in existence rests on absolute mastery of the production and distribution of that commodity (including adjusting to changes and innovations that will appear), there really seems to be a level of innovation and difficulty in what Qualcomm is doing that sets them apart. It's just hair-raisingly complex to produce working mixed signal chipsets for products based on their technology. I don't work in the field, but do have background in analog and digital signal processing from DC thru microwaves, and what they do really is difficult! Vastly more difficult than something like the audio codecs in a RealNetworks player you can download on your computer, or many of the other things making up the dot com bubble. That's why your comparison with Intel is not unreasonable. Intel has never stopped innovating to increase processor performance, and Qalcomm will not stop innovating in the development of asics to support CDMA and whatever is coming in the future (no doubt based on OFDM or some variants some day.) I fully agree though about the share price... and that another 10 bagger is not in the works in any near time frame, not with the economy right now and the spectacular gains in 1999 behind us, even if a lot was given back.