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

To: slacker711 who wrote (48430)	11/4/2005 1:04:30 PM
From: Maurice Winn	Respond to of 196444

Slacker, it all looks fair, reasonable and non-discriminatory to me. Anyone can buy QCOM ASICs and get a discount. Or, if they prefer they can buy somebody else's and not get a discount. Where's the discrimination in that? They don't say "But negroes, women, homosexuals, left-handers, Catholics, Nokia, Iran, Ericsson, Osama and Broadcom need not apply". Similarly, QCOM has offered the Chinese royalty system to Korean companies [who decided they didn't like it - they just want the cheap bits of it, not the export part]. I suppose other companies could choose the Chinese royalty rates too [purportedly 2.6% and 7% or thereabouts and buy the ASICs]. I knew it would happen. There is too much money sloshing around and lawyers aren't getting their share of it. The first thing to do is define the market really tightly so that only QUALCOMM technology is inside the net. Don't get wifi, wimax, ofdm, adsl, fibre etc tangled up in there. The market shall be mobile GSM-based 3G services aka 3GSM. Maybe Dora could be ring-fenced too. Hmmmm. No, better not include that in the market as that doesn't have the 5% Hagfish Guild total royalty rate arrangement. Okay, "THE MARKET" is hereby declared to be 3GSM only. That's narrow enough to get QCOM cornered, like a bull in a bull-ring. Now, bring on the legal picadores. Lots of politicians are needed to lead the public mob baying for blood and money. Six matadors to apply the coup de grace! Now for the bullfight. The matadors had better be careful: thecopymacheen.com Mqurice

To: slacker711 who wrote (48430)	11/4/2005 1:56:14 PM
From: slacker711	Read Replies (1) \| Respond to of 196444

I'm not sure what to make of this.....3 is listed as a commercial BREW operator on the Q website. Every other opeator (that I recognise) seems to be right, so I dont know if this is a mistake or if they are accidentally revealing something ahead of time. brew.qualcomm.com O2 isnt even on there so it isnt like they are just looking at a uiOne win. Slacker

To: slacker711 who wrote (48430)	11/4/2005 2:03:33 PM
From: Jim Mullens	Read Replies (1) \| Respond to of 196444

Slacker, Re: BRCM Complaint – Thanks for bearing with me on this as I see what your referring to on page 35 of the BRCM Complaint, - Price Netting >>>> Applying Slacker’s Comments In your columns, change the royalty to Q for a handset with an MSM from $10 to $8.90 (($200-$22).05). That $1.10 in IPR savings is dependant on the handset manufacturer using a Qualcomm chipset. If they use a merchant chipset from anybody else they dont get that savings. Handset W/ Q MSM W/O Q MSM Delta ..Chipset ....Q Chipset Rev $22 ....BRCM chipset Rev $22 ..Handset ASP $200 $200 ...Less Q chipset ASP ($22) $ 0 ...HS Royalty Base $178 $200 ...HS Royalty @ 5%....$ 8.90 .......$ 10.00.....$1.10 ...Effective Royalty % 4.45% ...... 5.00% Chip IPR rev to Q ..Q chipset $0 ..BRCM chip IPR fee @5% $ 1.50 Summary ..Qualcomm Rev/ HS ....H/S royalty $ 8.90.. $ 10.00 ....Chipset Rev ......Actual Chipset $22 $ 0 ......Chipset IPR $ 0 $ 1.50 ....Total $30.90.. $11.50 From the above, due to the Q’s apparent “price netting” formula, the handset mfg using a Q MSM saves $1.10 on a $200 handset vs. using a non- Q chipset. This $1.10 savings amounts to 0.55% and depending how FRAND is interpreted could be considered “discriminatory”. The effective royalty rate on the total handset ASP becomes 4.45% with a Q chipset, and 5% without a Q chipset. Possible Solutions>> 1. Eliminate the netting, and thus charge the handset mfg 5% of the ASP regardless of who’s chipset resides within the handset. A net benefit* to Qualcomm of $1.50 per handset for those with a Q chipset. 2. Eliminate the netting, and thus charge the handset mfg 4.5% of the ASP regardless of who’s chipset resides within the handset. A net loss to Qualcomm of $1.50 per handset for those with a Q chipset. 3. Split the difference Revenue Neutral to Qualcomm and the handset mfg. What the hey, assume the Q achieves a 50% chipset market share in CDMA/WCDMA based technologies and revise the effective handset royalty rate to 4.775% -- Everybody happy??? 4. Now of course thru discovery or otherwise, we have to determine how the GSM folks have been pricing their IPR over the years. And, we may find that the Q was just following their example or even applying FRAND more reasonably.