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

To: Rono who wrote (20627)	12/31/1998 12:43:00 PM
From: Gregg Powers	Read Replies (1) \| Respond to of 152472

Ron: Whatever you think about my opinion regarding Qualcomm, please recognize that these comments come after literally thousands of hours of research and the commitment of over $200mm of client assets to the equity. Agree or disagree with my conclusions, it's a free country. But understand that I have tried fastidiously to be well schooled on the topic. With the exception of Airtouch and 360 Communications (since acquired by Alltel), I have avoided investing in wireless operators. My negative bias derives from the observation that much of what is good for equipment vendors is bad for operators. PCS, for example, ended the comfortable duopoly enjoyed by 800mhz carriers. The deployment of PCS, and the competitive response of the 800mhz carriers, i.e. an accelerated migration to digital, benefits equipment vendors but challenges the traditional wireless operating model. ARPU (average revenue per unit) is under pressure and are churn rates (as customers move around to capitalize on various carrier incentives). I own ATI because I believe the company to be managed brilliantly and I believe that the Street, until recently, was underestimating the value of its foreign investments. 360 was a largely rural carrier. I reasoned that the geographic obscurity of its network footprint reduced the incentive and economic reward of PCS competitors. This led me to conclude that the Street was overdiscounting the threat of PCS competition as it related to 360. As such, these are point investments made within a specific conceptual theme. I have avoided TDMA-based carriers, including those with GSM exposure, as I believe their low productivity minute factories place them at a significant disadvantage versus CDMA-based PCS providers. Nextel's footprint is impressive. I think the voice quality is more than acceptable. The strategy of marketing as an economical service for small business is clever, although I have not analyzed the actual economics (and therefore cannot calibrate the niche's defensibility). However, my greatest concern would be whether Nextel's technology platform has sufficient manufacturing and R&D economies to allow for it to remain competitive as the price of competing cellular infrastructure continues to decline. PLEASE...PLEASE...my comments are 20,000 feet food for thought and should NOT be construed as a complete, or even overly clever, analysis. All the best, Gregg