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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 (52897)	6/27/2006 5:55:11 PM
From: slacker711	Read Replies (3) \| Respond to of 196981

Qualcomm has an ace up its sleeve RISHI RAJ Posted online: Wednesday, June 28, 2006 at 0048 hours IST financialexpress.com NEW DELHI, JUNE 27: Global CDMA patents holder Qualcomm’s CEO Paul Jacobs, currently on a firefighting mission to India, is carrying a proposal to soften the intense lobbying by CDMA players to lower the 7% royalty charged on handsets sold in the country, according to sources. When he meets communications and IT minister Dayanidhi Maran on Wednesday, Jacobs is likely to propose funding a government-owned telecom research institute by investing 7% of all royalty earned from India. He is likely to suggest that the institute be located in Tamil Nadu — Maran’s home state. The Qualcomm offer will be in step with a similar model it has deployed in South Korea where around 20% of the royalty payment received by Qualcomm goes towards funding the government-owned Electronics and Telecommunications Research Institute (ETRI). Qualcomm believes the offer will make up for its inability to lower royalty on handsets sold in India. Ahead of Jacobs’s visit, Qualcomm’s vice-president and division counsel, licensing group, Mike Hartogs, said in a webcast address that the company had no plans to reduce royalty. The demand for lowering royalty to help reduce handset prices and penetrate the rural market is an item high on Maran’s agenda. In 2005, India contributed 2.2% to the total royalty earned by Qualcomm globally. Jacobs’s meeting with Maran is likely to be tough as the department of telecommunications (DoT) officials earlier said that they would exert pressure on Qualcomm to reduce royalty in India and bring it around a level it charged in countries like South Korea and China, around 2%. Earlier, Hartogs had announced that in percentage terms, royalty in India might be high but in absolute terms, it was among the lowest. He had said, Qualcomm’s earning through royalties from India was 15% lower than that from China. This is because handset costs in India are among the lowest in the world. Sources said, DoT officials would communicate to Jacobs the minister’s unhappiness with Qualcomm executives’ statements that India’s spectrum policy favoured GSM technology and that this had led Reliance Communications to think in terms of switching over to GSM for future expansion.