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

To: kech who wrote (91098)	4/23/2010 1:00:28 PM
From: Jim Mullens	Read Replies (1) \| Respond to of 197244

Ketch- re Apple’s royalty— Re: The point that is being raised is whether Apple only pays a royalty on its costs it pays Foxconn or if it pays a royalty on the sale price to ATT. Presumably there is an apple profit/markup in there somewhere? I suppose if Foxconn sells to ATT with an apple markup included in the price then it would be the same as Apple paying the royalty on its wholesale to ATT. I believe we have established that Q’s royalty from the 3G iPhone is based on the ODM’s wholesale price to Apple, and not Apple’s marked-up wholesale price to the carriers. Somewhere in the archives I also posted Altman’s comments on this--- indicating that Q compensates for this seemingly under payment with a higher ODM rate than would otherwise be applied to the final seller’s wholesale ASP. In Apple’s case with the $200+ mark-up, I doubt the higher rated fully equalizes the delta. And again, the Q limits royalties above a certain ASP which is still unknown.