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

To: Stock Farmer who wrote (76832)	5/3/2008 1:14:48 AM
From: Maurice Winn	Read Replies (1) \| Respond to of 197246

That's superficially true in a semantic way rather than a logical way: <Of the two parties in the dispute, one is arguing for "the same" price (for all parties, over all time) and the other party is arguing "things change" <ggg>> But Nokia is not arguing that what the market will bear is lower, but that they can contrive to get courts to adopt a Kremlinized central planning approach to pricing on a cost plus basis rather than a free market basis and thereby manipulate the courts to force Qualcomm to lower their prices. Qualcomm is in fact arguing for an increase or at least a continuation of the contract as Nokia supposedly has the option of doing. <As far as whether Qualcomm should be paid more, or less, for its IPR? As you said, price is what the market will bear. If they jack the price up too high, all of their customers (in addition to Nokia) will have them in court. > Note that you didn't say "They will ditch Qualcomm technology for something with more bang for buck, such as WiMAX, Wi-Fi, some other OFDM or TDMA system, fibre, lasers or pulsed monocycles, or abandon the business in favour of going back to making gumboots." "What the market will bear" doesn't normally mean the price at which customers go to politicians and courts to get state power to dictate pricing. It means the price voluntarily interacting suppliers and customers will agree on to maximize profits for the supplier. As I have said for decades and centuries [2 so far], Qualcomm is in a political business more than a marketing business. In 1996 and onwards people in SI scoffed at that idea. Now that this discussion is mostly legal stuff and political [Neelie/China/EU/the USA ITC and even begging President Bush to intervene [although he fired Carol Lam who was then hired by Qualcomm], people realize it's not a matter of "what the market will bear" so much as what various government departments will accept. Unfortunately, they will believe that Qualcomm is not entitled to much recompense at all, if any [China favours zero and Neelie and the Kroes Klutz Klan will opt for similar rewards]. If the USA doesn't protect Qualcomm's right to charge what they like, [which they haven't so far] then the USA will lose a LOT of cash flow. The key point which Judge Strine and others will not be able to get their heads around is that the only price which is a "reasonable" price is what the market will bear. Anything else is not reasonable but merely forced by a government confiscatory body who will hand the profits instead to other parties who they prefer such as spectrum owners, handset makers, or service providers. Mqurice