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To: tero kuittinen who wrote (11074)	6/3/1998 11:36:00 AM
From: Gregg Powers	Read Replies (3) \| Respond to of 152472

Tero: Some simple questions. Please explain succinctly the technological benefit of Ericsson's "higher chip rate". No hype please, just a concise, specific discussion. It's easy to pontificate that Qualcomm is being unfairly obtrusive, but please explain how worldwide telecom operators benefit from a bifurcated standard that is not compatible with the existing IS-95 installed base. You claim that QC has an "aggressive, hostile attitude", so I presume that you believe the company should just hand over its intellectual property because what--it is nice to help out our friendly Swedish neighbors? Gee, I wish I had been raised in a nice socialist country so I could be an extra good person too!! Nokia, Motorola and just about every telecom company other than Ericsson purchased an IS-95 license--so your argument that Qualcomm extorted excessive licensing demands is clearly and empirically invalid. All these licensees understood that Qualcomm intended to manufacture handsets and produce ASICs. Nokia and Motorola felt it was in their strategic best interest to produce chipsets in-house and both suffered a time-to-market disadvantage as a result. That's business. You attempt to portray this W-CDMA debate as Qualcomm versus the world. What cow poo-poo! It is really Europe versus North America with a sideshow in Asia. You consistently fail to address how the Europeans erected an IPR fortress around GSM that has basically precuded direct participation by the Japanese. You fail to note that DDI and IDO are deploying IS-95 now, while DoCoMo is still evaluating "test beds". Gee, it's taken Motorola over two years to get its handset to work, I wonder how long it will take Ericsson to commercialize W-CDMA. Isn't it talking about 2002-2003? European operators should, of course, sit with their fingers up their rumps until Ericsson delivers equipment rather than deploying IS-95 today and upgrading to IS-95C by 2000. Sure, that makes sense. But, of course, Qualcomm is a greedy monopolistic company and Ericsson is a philanthropic concern. Uh huh. As I have said repeatedly, Qualcomm's IPR is necessary for mobile CDMA regardless of whether or not we are talking about IS-95 or W-CDMA. Qualcomm will realize a royalty stream under either circumstance, and can certainly build and deploy equipment compliant with any W-CDMA standard developed by Ericsson. Why do you choose to ignore this? Is it the same reason you choose to ignore cdmaOne's growth in the Americas? Maybe you fail to understand that the U.S. and Japan are currently the two largest cellular markets in the world. You keep trying to present W-CDMA as a lose-lose for Qualcomm rather than a win-win. You are mistaken. IS-95 is continuing to expand globally while TDMA-based GSM will begin to go the way of the Dodo circa 2002-2003, and even if ERICY's W-CDMA standard gets adopted wholesale, Qualcomm's market opportunity would be GREATLY EXPANDED NOT REDUCED. QC will get W-CDMA royalties and IS-95 royalties and it will be able to compete for cellular business worldwide (even in fortress Europe). Ericsson is trying to make it as difficult as possible for Qualcomm to compete, but there will be no way for your Swedish compatriots to keep the camel's nose out of their tent. Best regards, Gregg

To: tero kuittinen who wrote (11074)	6/3/1998 12:08:00 PM
From: Jeff Vayda	Respond to of 152472

Tero One of your favorite points is the reduction in the rate of growth in the Asian economies. Dont forget the biggest cost is people. Increase the amount of work each person can do and you can reduce the number of people. Most companies today are dealing in the transfer of large amounts of data, make that process more efficient and you can reduce the number of people who do it. There is a new paradigm to this. Previously, when industrial technology displaced a worker there was not generally an application for the replaced talent. The trickle down from big company activity to small company was limited. If your steel mill closed you didnt go to a small local foundry. The information economy is different. When a large company reduces workers due to an increase in productivity, the smaller companies (who are trying to be bigger companies) generally have a need for the talent the larger company has just let go. The smaller company gets larger and the economy grows as a result. The telecom pie grows even when the overall economy slows. Information and a company's ability to handle it is the driver for success. I dont see a company being able to neglect this segment for more than a quarter. Evidence the continued telecom growth in Korea despite the overall economic woes. Jeff Vayda

To: tero kuittinen who wrote (11074)	6/3/1998 4:29:00 PM
From: Maurice Winn	Respond to of 152472

Tero, I haven't read all the thread, so some of this might be redundant if others covered it, sorry if so. Thanks for taking the time to think it through, but I have a few challenges to what you said. You said: "It appears that Qualcomm has decided to attempt to block W-CDMA entirely or force it to be corrupted by lowering the chip rate. This aggressive, hostile attitude fits pretty well the established pattern previously shown by forcing Nokia and Motorola to design their own chips by making excessive licensing demands. That earlier demand backfired in a big way, slowing down the technological progress of new CDMA handsets. I think there's a real chance that Qualcomm is once again alienating most of the international telecom community by playing hardball." I doubt that technical purists like Andrew Viterbi are keen to see much corruption of cdmaOne. This is their life's work which will stand for generations. They want it good. Gregg asked you to describe the deficiencies of the reduced chip rate. The fact that Nokia and Motorola decided to make their own chips is important. That is a test of the price Qualcomm put on the IPR. Too high a price and all would have made their own. Too low and nobody would have tried. Motorola didn't do too well, which is some circumstantial evidence that the price was reasonable. Nokia showed it can be done. Bravo for Nokia - is there anything wrong with Nokia - they seem to do everything right? I don't follow it much though. It seems that Qualcomm struck the balance about right. The price of IPR encouraged some competitors to do their own thing, which is good for competition and innovation. Alienating the international telecom community? That to me is the nature of competition. Competitors are not your friends. But the facts are that the competitors were not alienated. Nearly all have paid for IPR. The CDMA Development Group is a veritable whose who, including Ericsson I believe. Alienated? Qualcomm is being inclusive and continues to be, ensuring that all the IS-95 users will be included in the W.cdmaOne system, not excluded as Ericsson and pals are trying to do. An "aggressive, hostile attitude" seems to ill-fit the Qualcomm people or their marketing strategies. Of course they are selling their services for what the market will bear, but that isn't really aggressive or hostile. They seem to me very friendly, reasonable, agreeable people. The game is hardball. And fortunately, if push comes to shove, the USA is the most powerful country and able to protect IPR internationally if needed. So the Europeans won't simply steal the software. Neither will China. You then thought we were overexuberant here about cdmaOne growth rates. China, Korea, Japan, Philippines, Singapore, India are all users of cdmaOne. Already! The infrastructure is in place and ready for market development as demand grows. Don't you think it likely that with GSM announced as being the legacy system, and Qualcomm owns the IPR for the next system, that growth will be rapid in cdmaOne? Sure, GSM has huge growth rates now, but cdmaOne growth rate is faster. Much faster! Qualcomm's strategy of covering all points of cdmaOne was wise. If they had left handsets to Motorola, guess what. There would have been no handsets. If they had not developed infrastructure, there would have been few suppliers and competition would have been reduced making phone companies more reluctant to buy. They have licensed all and produced all. They have reduced economies of scale on a wide front as you suggest, but it was an essential strategy in my opinion. They did come a gutser with NextWave, though that story is far from finished. They are reducing the risk by spinning off the phone operator business. But ASICS were essential, handsets were essential, infrastructure was probably a good idea - no harm done, and standards and technical developments are their forte. All pretty balanced I reckon. You ask how voice recognition etc are going. I suppose quite well, just as other things have done. As you say, they are in a big race here and the advantage is to the free cash flow, to coin a phrase, of Nokia and Ericsson. But Qualcomm will continue to hurry along and if they don't Sony and other handset makers have a good free cash flow and will be able to bring competitive cdmaOne handsets to market. Don't forget Unwired Planet, Palm Pilot and a host of other joint ventures by Qualcomm. They are nothing if not inclusive! Thanks Tero, I appreciate reasoned criticism of Qualcomm and if I search through and find nothing to worry me, I'm greatly encouraged. The best critics are competitors and people like you. They find the worst there is and if there isn't much, yipppeeee! Mqurice PS: My compliments to Nokia are quite genuine. They really have been remarkable. They had the wit to get into cdmaOne years ago, they have gained position in handsets and with gadgets like the 9000 are real leaders. I think you'll find them succeeding very well in cdmaOne too, not leaving it on the back burner.

To: tero kuittinen who wrote (11074)	6/3/1998 5:32:00 PM
From: Maurice Winn	Read Replies (3) \| Respond to of 152472

Tero, speaking of reviewing predictions and Bill Frezza was keen to do so, so in absentia, here is Bill Frezza from the world of 1996. On Fri Oct 11 09:23:36 1996, Bill Frezza, from Network Computing , wrote: To Mr. Gregg Powers - thank you for your impassioned post. Has Airtouch played the fool? Yes. As you said the results will be in soon and it will be so obvious that even the blind will understand. CDMA at 800 MHz can only be described as an unmitigated disaster. Airtouch's "strategy" to migrate their highest volume users to CDMA on an invitation-only basis is a blatant coverup of this failure, aided and abetted by "analysts" that are committed to supporting the story. At some point, the line will be crossed between failure and fraud. Some say it has already been crossed. That will ultimately be up to a judge to decide. ------- Will CDMA "work" at 1900 MHz? Someday, yes. As you so aptly point out, there is too much money and too many careers invested to let it fail completely. Will it confer competitive advantage to the carriers that use it? No. Will these carriers lose money? Yes. Will their vendors lose money? Some of them will and some of them won't depending on how their deals are structured ----- Why don't we stop arguing about the "potential" of CDMA and its long list of celebrity endorses and start talking about reality? It has been over 6 months since CDMA was "launched" in the US. How many 800 MHz CDMA subscribers are there? Maybe 1,000? In six months of commercial operation the first US GSM system (APC) garnered 100,000 subscribers. This is in one city! ------ In six months, we will ask the same question about CDMA PCS subscribers. Primeco and Sprint have made some bold promises about 1996 launches. I can't wait to measure the results. Not the number of press releasese and media events where single phone calls are placed by prominent politicians, but actual results, meaning subscriber counts. ----- As for offering Korea as proof of the success of CDMA, I confess that I don't understand the Korean market as well as the US market. I do know that they are not the same and it is dangerous to draw conclusions without knowlegde of all the facts. Korea Inc. has bet the ranch on CDMA, which means there are many forces and factors propelling it forward. These forces will not exists here in the US. CDMA will have to make it in the face of bloody price wars and excess capacity. CDMA was invented to solve the opposite problem - insufficient capacity in an environment that could sustain high duopoly pricing. So, CDMA supporters, please, keep posting. We can archive all of this stuff and then roll it out again in six months. ------------------------------------------------------------- Okay, here we are rolling it out, 18 months later. Bill F was wrong! Tero we can roll out June 1998 in June 2000. It should be interesting. Mqurice