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: gdichaz who wrote (16976)	10/22/1998 7:21:00 PM
From: Maurice Winn	Read Replies (2) \| Respond to of 152472

Chaz, people, bright ones included, do get things wrong. Check out Bill Frezza for example. Any day of the week I'd be admiring him and his ideas - yet for some reason, on CDMA, he bought the L M Ericsson ideas hook, line and sinker. Since he was previously a marketing director of L M Ericsson and was on a 3 day a month retainer, he might simply have been spouting the company line. Maybe he even established the company line towards cdma while he was in charge. Once companies or groups of people are entrenched in an idea, they find it hard to move even if facts batter them in the face. It could well be that they really did decide that CDMA wouldn't have a chance. GSM would be so far advanced that the small advantages of CDMA wouldn't matter, especially since they didn't think it could be made to work anyway. That is what they were saying. In fact, the initial systems did have major problems. Los Angeles never really got going on the 8 Kbps system. Handsets have been a disaster for Motorola. Nokia has had trouble. Network design seems to have been more tricky than simply dropping another base station into the network, if you wanted the system to be economic anyway. I sat in a meeting with a QUALCOMM guy telling Telecom New Zealand that they wouldn't really need network engineers with a CDMA system because you just bung in another base station [though he didn't use the words 'bung in' of course]. That was early 1996. The network engineers were looking left and right! Maybe as base station costs decline, it will be a matter of just popping another little box in another house attic, with adaptive array antennae, but we aren't there yet. I suppose Ericy has done some work on CDMA, but could never see their way to making it sing, so packed it in and concentrated on the winner = GSM. So now, [well, two years ago], faced with the reality of cdmaOne by QUALCOMM, they had to start making serious defensive moves. Start by patent disputes. Tell everyone that the systems will be a blind alley. Won't really work. Will be too expensive. Better go with GSM. QUALCOMM is a fraud and it would all end in shareholder damages claims and litigation [not litigation over patents, but litigation by conned shareholders]. Then go flat out on some 3G ideas and negotiate with QUALCOMM for licences. But damn it all, The Q! wanted too much money for a system which would probably only have 10% market share in 10 years. OOPs, the cdmaOne systems seem to be deploying quickly. Now what. Keep up the FUD. Give 3G both barrels. Go for broke in patent litigation. Get political and SETI support. Get support from all the cdmaOne licensees who would like to pay no royalties - the Koreans had been moaning like crazy and the Japanese would like it free. And that is the path Ericy has taken. They can't force The Q! to sell them a licence. So they have been snookered. No wonder they are thrashing around in all directions. Even if they gain 6 months by more FUD, that is a lot of GSM selling. To the suggestion that royalties should be lower, I say no because the evidence is that cdmaOne is so difficult to produce as shown by the handset and network problems in Motorola and problems elsewhere, the value of success is high. So claim the success for the creators - don't give it away. So yes, Ericy probably did believe a lot of what they said - well, some of it anyway. They have wanted licences at a cheap price. Most people believed it, that's why I could buy Q! shares at $18 in 1994. And GSTRF at $3 in 1995. Mqurice