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

To: David E. Taylor who wrote (22034)	4/30/2002 1:39:20 PM
From: gdichaz	Respond to of 197214

David: What is so difficult is that it is hard to look ahead. For example, India is a huge market, yet the GSMers are using the court system to try to kill CDMA. In Latin America, the regulatory bodies are in the pocket of the GSMers. In Europe, there is zero chance for Qualcomm unless and until the WCDMA (laughingly called UMTS - nothing is "universal" about it) is put in place by those who haven't a clue about the real world of CDMA But the joy is onward and upward. The games starting in Korea/Japan will be fun, fun, fun. The GSMers will be on the outside looking in - using CDMA to the extent they can. Best Chaz

To: David E. Taylor who wrote (22034)	4/30/2002 2:06:15 PM
From: engineer	Read Replies (1) \| Respond to of 197214

I think if you really take a look at the market forces, you will see the answer. The GSM crowd is flooding hte market wiht the lowest cost fully amortized solutions they can while they are competitive and Q is responding by lowering hte IS-95 only chips to try to get handset pricing to match them. I think the GSM guys will drive their margins alot lower just to HOLD the biz in places like china and cingular, and it would be intersting to plot the margins levels for NOK and others who make GSM chipsets. since most of them are internal only, this is a much harder thing to do. the total mix of chips will keep building up more from the lower end as the handset pricing goes lower. I expect the ZIF chipsets will actually go up alot as they offest quite alot of RF analog junk that the handset can throw out. I would predict that if they eliminate $8 of RF junk, they can demand a $1-2 higher price in teh end, which will push the ASP mix back up. there is alot to think about when trying to estimate this. but the fact that the Margins jumped back up supports exactly what I said. they are driving down prices (their costs) at the same time they are bringing out new products. the curves you showed are actually very good for a semi house overall. the fact that they have had ONLY flat sales during this giant downturn, that is a very good thing. Alot of the others had major downturns in the amount they shipped during the last two years. Having said that, I think we are now at the beginning of a major upturn in volume for all of wireless, both in replacements and in new subs. As the economy recovers, the handset sales will increase. Later.