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

To: Michael Allard who wrote (129176)	5/22/2003 11:19:42 AM
From: Art Bechhoefer	Respond to of 152472

Michael, the Wi-Fi investment choices are not very attractive, at least not now. One company, Smith Micro (SMSI), well known for its fax modem software, claims to have something of that order useful for Wi-Fi. The stock has gone up tremendously and does not represent good value IMHO. The obvious choice, however, for the Wi-Fi addicts would still have to be Intel, with its Centrino chip. If Wi-Fi succeeds, it will be because of the Centrino, and the ability of computers with that chip to integrate seamlessly into an office or other institutional network. I doubt that the Centrino will contribute more than a few percentage points to Intel earnings, at least for the next year or so. Then you could also consider Cisco, which wants to sell routers suitable for VoIP, which would enhance a Wi-Fi network. Again, the contribution to earnings from this segment would be almost miniscule. Cisco also acquired capabilities to produce Wi-Fi and related base stations, those ubiquitous boxes that feed into a DSL. This has already become a commodity business, as there are several competitors. And we all know that a commodity business is characterized by low profit margins. I would be more enthusiastic about Wi-Fi if it were a proprietary technology as useful as sliced bread. But in fact, as Andrew Seybold has noted on numerous occasions, this is a niche technology for limited use (compared to full scale wireless). What does impress me, however, is that Wi-Fi is apt to be a successful attempt to bring wireless capabilities to the low end of the market. That is, it is a low technology, fairly low priced solution for at least a few well defined wireless applications. But I wouldn't buy Intel or Cisco simply on the basis of their involvement in Wi-Fi. Art