Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Qualcomm Incorporated (QCOM) -- Ignore unavailable to you. Want to Upgrade?

To: Asterisk who wrote (14736)	9/9/1998 6:47:00 AM
From: tero kuittinen	Read Replies (4) \| Respond to of 152472

doug - threatening to block a new international standard if you don't get sky-high licensing fees is pretty radical. Nokia has invested huge amounts of money in W-CDMA and now one of the several companies claiming IPR threatens to derail the entire project if it doesn't get what it wants. What if Motorola had some key patent and made the same threat unless iDEN compatibility was built into W-CDMA? Can you see how this kind of ultimatum-driven game of chicken can spin totally out of control? The newest figures I have seen show 13 million CDMA subscribers in the world... 9 million of them in Korea. I don't think the international bodies will regard IS-95 so crucial that it cannot be left out of W-CDMA, especially when making clock-rate chances at this point would be very expensive. Here's an idea. If Qualcomm really believes in free competition, let's have free competition. Let Qualcomm build a 3G solution compatible with IS-95 and Nokia/Ericsson can counter with their 3G model that is compatible with GSM. Of course Qualcomm would get some reasonable licensing fee for W-CDMA IPR - just like any other company with W-CDMA IPR. Let the best man win. Let the market decide. How come free competition among different standards suddenly becomes undesirable when it starts to scare Qualcomm? If four digital standards in USA was supposed to be a great idea, how come W-CDMA, the upgrade of GSM, is now being forced into accommodating niche standards? The Japanese situation reminds me of "Rashomon". Apparently everyone sees what they want to see. Docomo was planning W-CDMA with Nokia years and years ago - they have wanted access into GSM markets and Nokia wanted access into Japanese markets. With W-CDMA both get their wish. To see IS-95 as some kind of motivation for W-CDMA is highly creative. Let's talk about Australia, Michael - their first choice was GSM and it will not be overtaken by CDMA. Mexico - the biggest opearator goes for TDMA. Venezuela - GSM just broke in. Brazil - TDMA is carrying the day. South Africa - GSM rules. Israel - GSM. If the first/biggest operators opt for GSM/TDMA I don't see how some adoption of CDMA by smaller operators in any way vindicates the standard. Here's the crux: there is no erosion in GSM sales growth in countries where the two coexist. Hong Kong is showing the lesson: CDMA cannot turn the tide. Buying this stock at this price may be a reasonable side bet - there is a strong take-over prospect and guaranteed licensing income. But IS-95 as a truly global standard is not in the cards. I'm waiting for some fall-out from 3Q/4Q results and the W-CDMA negotiations and probably entering if it dips to 36-38 range. Tero