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

To: RalphCramden who wrote (28862)	11/13/2002 5:05:31 PM
From: Art Bechhoefer	Respond to of 197016

There are many unpredictable factors that would change earnings, even if CDMA subscribers increased at a conservatively low rate of 10 to 20 percent. Royalties per unit sold in China would drop because the cost of low end phones is coming down. The same would be true in India, where presumably the basic phone for villages would be mainly for voice. But upgrades for existing subscribers or sales of high end units for new subscribers to 1X services would result in higher royalties and also higher profits from more complex chip sales. Frankly, we are getting to a point where competition will sort out the fast growth opportunities from the higher cost, lower growth systems based on GSM. Switching from GSM to CDMA2000, either through purchase of new CDMA handsets or GSM-CDMA compatible units seems the most likely path, and not WCDMA. Just my hunch, based on cost of service as the main determinant. Art

To: RalphCramden who wrote (28862)	11/16/2002 12:07:31 AM
From: Clarksterh	Read Replies (1) \| Respond to of 197016

That is, if there are 100 MM new CDMA subs per year for 20 years, then QCOM's revenues are pretty much FLAT over those 20 years, or at best growing slowly. In order to have 35% growth a year, QCOM needs to add subs at ~20% increasing rate each year. You are forgetting about replacements, which are proportional to installed base. Yes, as the drive for technological replacement diminishes the turnover time for phones will undoubtedly increase, but I'd bet it won't exceed double the current time for at least 10 year - even my cordless phone is replaced every 4 years or so. Clark