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

To: JGoren who wrote (19138)	12/4/1998 3:16:00 PM
From: bananawind	Read Replies (4) \| Respond to of 152472

JGoren, Jeff, all. You all seem to be missing something in the marketshare figures that were quoted as part of the Dataquest article. Point 1 - the figures relate to US sales only of all digital handsets and thus lump together TDMA, cdmaOne, and GSM markets. Since QCOM has a 0% share in two of those markets, the market size is growing, and most others on the list sell handsets into all three(or at least 2) of the markets, it should come as no surprise that their percentage share of digital handsets sold in the USA declined. Duh, so what? Does it mean QCOM's share of cdma handsets is declining? That may be the case and would not be unexpected (since they were practically the only USA seller in 1997), but you sure can't infer it from the Dataquest figures that were cited. Point 2 - Play with the Dataquest numbers a little and you will see that they imply that QCOM is on track to sell 1.1 million handsets in the USA this year versus 870,000 in 1997. You can derive these numbers from the market shares and annualized total digital handset unit sales in the article. Remember, however, that QCOM used a good part of their line capacity in the first half of the year for reworking the phones that had problems. This probably means that Dataquest's 9-month figures, while accurate (maybe), distort the true market share numbers. Remember, the overwhelming majority of sales are from manufacturer to service provider. These are not retail sales that are being counted. Point 3- QCOM has said they are capacity constrained, and we certainly have plenty of anecdotal evidence that this is true, and that they would consider future additional capacity as required. So how does this somehow make them "bit players" in the cdma handset market. Question-- what other manufacturer has shipped 7 million cdma handsets to date? answer -- none. (we won't even ask who has shipped 25 million cdma ASICS) If your system operator does not have any QCOM phones in stock it just could mean that he messed up, not QCOM, and underestimated final demand. Best regards, Jim