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

To: Kayaker who wrote (38951)	1/23/2004 7:20:27 PM
From: Jim Fleming	Read Replies (1) \| Respond to of 197214

Cooters and Kayaker Won't the DV chip distribution be limited by the carriers who choose to deploy the technology? i.e. Sprint at first. Jim

To: Kayaker who wrote (38951)	1/23/2004 8:30:20 PM
From: Jim Mullens	Respond to of 197214

Kayaker, Re: TXN (NOK3) / EV-DV/ chipset competition and “but I have to think that TXN will eventually catch up. Even if they are a step behind, they may come up with attractive chipset features/pricing and severely impact QCOM's sales. But I don't really know........I wish I had a better feel for it.” This appears to be one of the “analysts” primary concerns, and holding back their long term growth rate forecasts for the Q. I’m becoming less concerned for several reasons. 1. Who will their customers be (other than NOK)? Why would any of the handset manufactures buy from NOK3 and thus support their major competitor? NOK with their volume and tremendous clout with all the component suppliers gets first priority on everything and kills the competition at every turn. One of the prime reasons Qualcomm divested the handset business, was because it couldn’t resolve a business case of competing with its customers. It just doesn’t make any sense, especially if you’re the dominate player in the market. Is it any wonder that the most recent PRs on the NOK3 arrangement came from only TI and STM and excluded any mention of NOK. Despite words to the contrary, could it be that NOK3 is becoming a very hard sell? 2. If NOK3 were to acquire a few customers, I imagine it would have to do so on price and price alone as this is basically a new company (three companies) with little history of success in the CDMA market. How much would NOK3 have to under price the Qualcomm total solution? I imagine that NOK3 will initially be entering the low and mid-tier markets . Qualcomm’s MSM ASPs in these markets are probably in the $10 -$15 range as their average MSM ASP is approximately $22. Would a handset mfg go with an unproven source for a few dollars difference per chipset package? It should also be noted that in this weeks earnings CC the Q revealed that Flextronics is now selling entry level handsets. So perhaps, the Q even can compete effectively in this market. 3. Qualcomm sells itself as a “one stop shop”. The NOK3 outfit is anything but. NOK3 is using the modular concept rather than Qualcomm’s integrated approach. A new company using NOK3 will really be dealing with three companies and this could become a major headache when resolving problems if something doesn’t work properly- who has the responsibility for what and what is the problem resolution process? 4. The Qualcomm “integrated” chipset approach consumes significantly less power with more of the phones features/ components included on the MSM, rather the NOK3’s modular approach which requires hard wiring of the added separate components (features) together. I don’t believe I’ve seen any answers to the above that makes a strong business case for the NOK3 venture. If anyone can come up with a strong business case for NOK3, I’d sure like to see it.