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

To: Eric L who wrote (76911)	5/5/2008 4:33:36 PM
From: Art Bechhoefer	Read Replies (2) \| Respond to of 197275

Eric, in partial response to your detailed comments, the following quote is from the recent Nokia press release on Q1 earnings: Our device average selling price (ASP) in the first quarter 2008 was EUR 79, down from EUR 89 in the first quarter 2007 and down from EUR 83 in the fourth quarter 2007. The lower year on year ASP was primarily due to a higher proportion of lower priced products and to a lesser extent the negative impact of the weaker US dollar. The sequential ASP decrease was primarily due to a higher proportion of lower priced products, a mix shift to lower ASP regions and to a lesser extent the negative impact of the weaker US dollar. Starting from the first quarter 2008, our device ASP excludes net sales from our Services & Software business. Prior periods have been reclassified for comparability purposes. The company notes a decline in ASP, attributed mainly to "a higher proportion of lower priced products . . ." These words from NOK management appear to be consistent with my view that NOK gets increasing sales from low end (GSM only?) handsets, but does not do as well at the high end, where WCDMA and related IP are essential. My view has been, and still remains that NOK derives a great deal of its success from maximizing profits on low end handsets that do not require QCOM IP, and at the same time promoting strategies that tend to discourage rapid adoption of 3G handsets, which in many instances require use of QCOM IP. The strategy is beginning to backfire as more and more users switch to WCDMA. As to the set aside for contingencies, it may or may not cover potential royalty payments to QCOM. Nokia, after all, is involved in other litigation apart from the QCOM related matters. Art