Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

To: Robin Plunder who wrote (106952)	10/13/2001 12:43:50 PM
From: Mike Torrence	Respond to of 152472

A technical question for anyone who might know the answer. We've heard on a number of occasions over the past two years that delays in service upgrades are, in part, a result of a lack of availability of handsets. My question is: Other than the chipset is there anything else that could cause these delays? In other words is the wireless phone a lot more than a chipset and some plastic? (I'm assuming the network upgrade is in place, base stations etc.) Thank you in advance.

To: Robin Plunder who wrote (106952)	10/14/2001 3:01:03 PM
From: Art Bechhoefer	Read Replies (2) \| Respond to of 152472

The main difference between QCOM and the other companies mentioned in your post (sunw, jdsu, emc, ntap, lu, nt, csco, intc, dell) is the difference between proprietary technology for which there is no viable substitute (CDMA) and commodity products, where there may be patented technology, but there also are substitutes. GSM is at best a poor, higher cost substitute for CDMA. The difference between companies that have unique products and those in the commodity business is summed up in one phrase: profit margins. They will be high for unique products and low for commodity products, particularly in periods where there is a glut of products, as is the case for many of these commodity products. The mistake that many investors make is NOT differentiating between commodity products and unique, patented ones is that while the price earnings ratios of both groups may look high, the profit margins for companies like QCOM justify a much higher PE than that for the commodity producers. Bottom line: Even in a depressed stock market where economic conditions raise great future uncertainties, a PE of 60 for QCOM is more reasonable than a PE of, say 20 for the commodity producers. Art