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

To: Peter J Hudson who wrote (114114)	2/23/2002 8:32:51 AM
From: qveauriche	Read Replies (5) \| Respond to of 152472

Peter makes a very good point. QCOM not only had to create a superior technology, which was impressive enough. It also had to invest heavily in proving the viability of the standard by operating at significant losses both an infrastructure business and a handset business. It has also had to be proactive in making sure that there is a CDMA competitor in the greatest number of markets. Without a CDMA competitor there is no competitive pressure upon the TDMA/GSM carriers to move on to the next best thing.With it there is, an unpleasant reality which Cingular and friends are soon to confront. John would be right to point out that the necessity of such undertakings adversely impacts the value of QCOM as an investment as reflected in the low levels of retained earnings. Keith and Peter are right that this effort has been successful against overwhelming odds given the financial power and entrenched political influence of the Lords of GSM. And that the period during which such burdens of sponsorship will be required is quickly passing away. With all the talk about QCOM being a large cap and just how much could it possibly grow from here, there is a real sense in which QCOM can be analogized to a start up tech which at great expense has at long last positioned itself for worldwide acceptance of its superior proprietary invention. John is a wonderful and impressive writer, and has been of great benefit to me in isolating the crucial flashpoint on which this entire debate about QCOM valuation will ultimately turn. That is, in the case of this company, is past performance indicative of future results. If it is, John is just by God can't get around it dead right.Obviously I think otherwise,even as I can understand the frustrations of waverider and others at the length of the process of realizing QCOM's potential.As emotionally wearing as the parabolic spike and decline has been,and as much as I wish my good judgment hadn't been clouded to the point that I passed on the opportunity to cash out on QCOM and any number of other stocks, the greatest influence on my patience at this stage of things is the 3 years leading up to the spike when I held this stock underwater, enduring the "pipe dream" and "natural home" taunts that posted almost daily on this thread, enduring the continual warnings from my "full service broker" that his wireless analyst had assured him that CDMA would never displace GSM and that IMJ was no visionary but instead a shameless carnival barker. More recently, I compare QCOM's reception this year as opposed to last at Cannes. Last year, Tero ranted about how "rude" it was for IMJ to crash the party and claim that the rival technologies didn't work. This year, Euro operators are themselves openly expressing their disappointment with GPRS even as QCOM dangles GSM1X before them. Last year, the Euro press treated IMJ like a pariah. This year we read that even though the film festival is months away, QCOM is "shining like a star" at Cannes. The Lords of GSM may not like it, but QCOM is now both fundamental and indispensable to whatever path the GSM carriers choose. A final thought. Two or three months ago, in the midst of all the doom and gloom and the emergent prevailing wisdom that the internet is merely a toy of limited economic value, and which has more or less become what it can become, at least anytime soon, there was a little noticed news article commemorating the 10th anniversary of the first US based web page going live. Think about that. Look at what the internet has become, how ubiquitous it is in our personal and business lives, in just 10 short years. It seems as if a certain conventional wisdom has foisted upon us a false dichotomy in which we are invited to decide whether (a) the tech revolution and its radical social and economic potential is real, or (b) the stock market was overvalued in 1999, without much consideration of the possibility that both could be true. If the internet has come as far as it has in the first ten years, despite the regulatorily mandated stranglehold on the last mile and the local loop (when i see the indignation of inbred labrador retrievers such as Ernest Hollings over the ENRON scandal, and I consider how infinitely much more wealth he and his cronies have incinerated with the Telecom Act of 1996, I just want to vomit)can you imagine what the next ten years will bring? We are in fact in the vortex of a whirlwind of change, a point that seems to be entirely lost among the "secular bear" crowd. Its as if they look only at the surface of the ocean oblivious to the gathering tsunami soon to come ashore. Financial (Japan and Argentina) and regulatory missteps can only temporarily defer its arrival. They cannot send the wave back out to sea. I think the next few years will prove George Gilder's bona fides as a futurist, even as the past couple of years have proven his limitations as an investment advisor. We live in interesting times.

To: Peter J Hudson who wrote (114114)	2/23/2002 12:22:35 PM
From: carranza2	Read Replies (3) \| Respond to of 152472

John's point, as I appreciate it, is that why should Q make CDMA investments if it is going to have a piece of all CDMA-based 3G. It is a good point, albeit a purely rhetorical one. Implicit in John's question is the notion that CDMAOne is or will soon be a legacy technology, a point which is absolutely correct. However, it is likely to be a long-lived legacy technology in the Third World, where the expense and sophistication of 3G networks are unnecesary. What counts there (India and lots of places in LA) is simple, effective, and cheap phone service. It appears that this is the justification for Q's investments in fledgling carriers. These markets are huge, untapped, and cannot be ignored.