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Nokia CEO says company will have to produce cheaper phones-CNBC
PrintE-mailDisable live quotesRSSDigg itDel.icio.usLast Update: 12:37 PM ET Jul 20, 2006
http://www.marketwatch.com/News/Story/Story.aspx?siteid=mktw&guid=%7B3544BAA4%2D272D%2D46B3%2DB1....
STOCKHOLM (MarketWatch) -- Finish mobile telecommunications company Nokia Oyj (NOK) will have to produce even cheaper phones in order to maintain its market share, Chief Executive Olli-Pekka Kallasvuo told CNBC Europe Thursday in an interview.
"We will have to get cheaper," Kallasvuo said.
He said he didn't think further gains in global market share would mean less profitability, pointing to the one percentage point year-on-year market share gain the second quarter to 34%.
Kallasvuo said he pinned his hopes for future growth on third-generation mobile phones and further expansion in emerging markets like China. "Consolidation will help us there," he said.
The Nokia CEO didn't anticipate any big deals like the one with Siemens AG (SI) in the near future, but said the company will seek to make smaller acquisitions as it sees fit. He also said the Siemens deal won't prevent Nokia from continuing its share buyback program.
On its licensing dispute with Qualcomm Inc. (QCOM), Kallasvuo said the company 'trusts and believes' it will eventually reach an agreement with the U.S. firm.
Company Web site: http://www.nokia.com
-Contact: 201-938-5400
Howerver, QCOM July 06 Max-Pain Point: $40
We shall see by end of Friday.
http://www.ez-pnf.com/maxpain/mp7618.htm
Re: WHY IS Q GETTING KILLED BEFORE EARNINGS TODAY?
Please see link:
http://telecom.seekingalpha.com/article/13861
Sentiment for Telecom Stocks: Positive and Negative
Posted on Jul 19th with stocks: AUDC, CIEN, CMVT, FFIV, JNPR, QCOM, TLAB
Snip:
Shlomo Greenberg submits: In a review entitled 'Bearish sentiment rising,' Merrill Lynch analyst Tal Liani expresses his views on the situation in telecommunications. He divides the companies into two groups, 'negative sentiment leaders' and 'positive sentiment leaders.'
Four companies are listed in the 'negative sentiment' group: Tellabs Inc. (Nasdaq: TLAB), Comverse Technology (Nasdaq: CMVT), Juniper Networks (Nasdaq: JNPR) and Qualcomm Inc. (Nasdaq: QCOM).
Three names appear in the 'positive sentiment' group: AudioCodes (Nasdaq: AUDC), Ciena Corp. (Nasdaq: CIEN), and F5 Networks (Nasdaq: FFIV).
Japan's KDDI to jointly develop software with cellphone makers - report
07.18.2006, 09:35 PM
http://www.forbes.com/markets/feeds/afx/2006/07/18/afx2888119.html
TOKYO (XFN-ASIA) - KDDI Corp will tie up with Toshiba Corp and two other firms to develop standardized cellphone software in a bid to slash the cost of developing cellphones, the Nihon Keizai Shimbun reported.
The newspaper, without identifying its sources, said the standardized software was expected to help makers of cellphones reduce development costs and allow them to make cheaper phones.
The partnership also includes Sanyo Electric Co and maker of cellphone chips Qualcomm Inc of the US.
It will develop software to support electronic mail, a digital camera, a music player and other advanced functions.
KDDI will then sell the software to companies that build phones for its 'au' mobile phone service. The phones are likely to appear in the market as soon as next fall here.
With the cost of developing a cellphone estimated at 10-20 bln yen, the need to keep up with new features and technological advances is straining manufacturers' budgets, the Nikkei said.
Through KDDI's initiative, cellphone makers will be able to cut software-related costs, which make up by 2/3 to 3/4 of development costs, the Nikkei said.
Analyst Is 'Fundamentally Bullish' On Qualcomm
R.M. Schneiderman, 07.17.06, 12:21 PM ET
http://www.forbes.com/2006/07/17/qualcomm-0717markets08.html?partner=yahootix
Despite potential legal risks, wireless technology company Qualcomm (nasdaq: QCOM - news - people) offers strong upside from current levels, according to a recent report by UBS Investment Research.
UBS analyst Maynard Um upgraded the San Diego-based company's stock to "buy" from "neutral," citing solid long-term growth prospects.
"Our fundamentally bullish stance largely stemmed from potential growth in the WCDMA market," he said, referring to the wideband wireless technology.
Nokia (nyse: NOK - news - people ) and Qualcomm are renegotiating royalty agreements, set to expire in April of next year. Nokia is trying to get a more favorable rate.
"We believe an agreement is in the interest of both parties and ultimately expect resolution," said Um. "In the interim, both parties are likely to continue to position themselves to gain leverage in negotiations, which could cause some share price volatility."
While Qualcomm's royalty and litigation issues remain a concern, Um said, investors are already anticipating a European Union investigation. The EU is debating as to whether formally investigate claims that Qualcomm has failed to fairly and reasonably license its technology.
The UBS analyst said an announcement could come as soon as August and that the EU is likely to proceed with a formal investigation. UBS said that it does not expect an investigation to result in a "material financial impact" on Qualcomm.
Qualcomm shares get pre-open lift from UBS upgrade
http://www.marketwatch.com/News/Story/Story.aspx?guid=%7bA2AC0EF5-B722-4193-B3F4-1C41EB8521C9%7d&....
7:53am 07/17/2006
NEW YORK (MarketWatch) -- Shares of Qualcomm (QCOM : QUALCOMM Incorporated(36.37, -0.19, -0.5%) rose 2.1% in pre-open trading after UBS upgraded the wireless technologies company to buy from neutral, due primarily to valuation. Analyst Maynard Um said that while risk surrounding potential European Union investigations and uncertainty over its current royalty agreement with Nokia (NOK : Nokia Corp.(18.57, -0.15, -0.8%) remains, he feels the reward vs. risk profile is "compelling," given the potential growth in the WCDMA market. The stock was last trading up 78 cents at $37.15 on Inet. As of Friday's close, the stock had lost 29% since the end of April. Meanwhile, Um cut his stock price target to $50 from $53.
DR, It will be Euro Cabal's turn to receive the effects inflicted on Qualcomm. It is call Karma( Cause and Effect.
After Qualcomm, royalty issue haunts GSM players
Siddharth Zarabi / New Delhi July 14, 2006
http://www.business-standard.com/common/storypage.php?leftnm=lmnu9&subLeft=2&autono=98178&am....
In the backdrop of the controversy over Qualcomm’s royalty structure and Reliance Communications’ problems with it, the debate within the telecom industry circles is slowly turning to the royalty structure which prevails in the GSM segment dominated by the likes of Nokia, Ericsson and Motorola.
Summarising the various components of the royalty fee that notch up to almost 10 per cent of the sales price for any equipment, some industry watchers hold this as the real hindrance in the growth of domestic manufacturing entities in the GSM space.
Various sources indicate a royalty fee per company of 1-2 per cent of the sales, taking the total fee (cumulative royalty fee) to around 10 per cent.
Citing the development of homegrown Chinese telecom manufacturing entities like Huawei and ZTE, which became forces to reckon with in the recent past, sources added that with India becoming a huge market for telecom equipment, it needs to follow the Chinese practice of opening the market for only those patent holders that agree to share patents.
It may be recalled that last year the ministry of communications launched a campaign to encourage manufacturing of telecom equipment domestically.
Pegging it on the Bharat Sanchar Nigam mobile equipment purchase order worth around $4 billion, the ministry has succeeded in getting a number of mobile equipment manufacturing companies to make a start with assembly facilities in Chennai.
Given that, a section of the domestic telecom equipment lobby now wants Communications and IT Minister Dayanidhi Maran to work towards ensuring that only those companies, which reduce royalty fees and give the government access to patents, be allowed to bag orders from public sector companies.
On the face of it, asking patent holders to share them may not be legally tenable, but this could make services more affordable.
CDMA major Qualcomm said its royalties in India on handsets were about 5 per cent. The firm has been criticised by operators in many emerging markets for the alleged high royalty charges.
However, given that over 78 million of the nearly 105 million mobile customers in India are on the GSM platform, the impact of royalties in this space may be even higher.
It may be recalled that India imported GSM handsets worth around Rs 15,000 crore last year from China, which benefits from the laissez-faire on patents and fees.
The news from India seems to have some positive effects on QCOM share price:down only 3 cents at 10:50AM
Symbol Time(ECN) Trade(ECN) Change(ECN) After Hrs Chg(ECN) Bid(ECN) Ask(ECN)
QCOM 10:50AM ET 37.52 -0.03 0.08% N/A N/A 37.50 37.52
Qualcomm may agree to chipset price cut for India
Press Trust of India / New Delhi July 13, 2006
http://www.business-standard.com/common/storypage_c.php?leftnm=11&bKeyFlag=IN&autono=2961
CDMA technology inventor Qualcomm is likely take up the issue of chipset price reduction for the Indian market at its forthcoming board meeting on July 19, which may result in a reduction in prices of handsets.
The CDMA technology licensor's market capitalisation has taken a knock-down of $15 billion, owing to several reasons like Nokia's pull-out of CDMA-based handset market and Reliance Communications' planned expansion into GSM-based mobile services.
During his visit here, Qulacomm CEO Paul Jacobs is believed to have favoured the chipset reduction model over the royalty cut, which he said has no scope for further reduction as being already low. But he had not committed any time-frame for this.
Indian CDMA operators have suggested Qualcomm bring down the chipset cost at par with GSM chipset cost. In low-end handsets (about $40), the CDMA chipset costs $10 while the GSM chipset costs $5. The $5 difference translates into a 12% rise in handset costs. The $10 chipset cost is 25% of the overall handset cost.
Operators are believed to have asked Qualcomm to reduce the chipset prices immediately rather than doing it over a period of time of 3 years.
DAY ONE OF NEW EU PATENT WAR:
EU COMMISSION PUSHES FOR LITIGATION AGREEMENT
July 13th, 2006
http://www.no-lobbyists-as-such.com/florian-mueller-blog/
- PRESS RELEASE -
DAY ONE OF NEW EU PATENT WAR:
EU COMMISSION PUSHES FOR LITIGATION AGREEMENT
EU internal market commissioner McCreevy said at yesterday’s hearing
on the future of European patent policy in Brussels that he wants to
“move forward” with the European Patent Litigation Agreement (EPLA) -
Anti-software patent campaigners vehemently oppose the EPLA,
claiming it is “from a software patents point of view […] far worse”
than the directive they defeated in the European Parliament last year
Brussels (July 13, 2006) - At yesterday’s European Commission hearing in Brussels on the future of European patent policy (http://ec.europa.eu/internal_market/indprop/patent/hearing_en.htm), the EU’s internal market commissioner Charlie McCreevy sided with lawyers and big-industry lobbyists by supporting the European Patent Litigation Agreement (EPLA). McCreevy described the EPLA as a “promising route” and said: “I have asked my services to move forward with this project.” McCreevy also announced a “multi-faceted package” of patent policy proposals that he will put forward before the end of the year and mentioned “patent trolls”, especially in the IT sector, as an issue he plans to tackle.
Anti-software patent campaigners spoke out strongly against the EPLA at the first large-scale clash of the pro- and anti-software patent camps in more than a year since the European Parliament rejected the software patent directive.
The European Parliament plans to vote on a patent policy resolution in late September. In the build-up to that vote, there will be an intense debate on the EPLA and, in particular, on whether it would result in the legalization of software patents in Europe and an explosion of litigation costs.
Florian Mueller, the founder of the award-winning NoSoftwarePatents campaign that helped to defeat the EU software patent directive last year, was one of the speakers at the hearing. He said in his speech that the EPLA “is just another attempt to give software and business method patents a stronger legal basis in Europe than they have now. […] From a software patents point of view, the EPLA would have far worse consequences than the rejected patentability directive would have had: not only would software patents become more enforceable in Europe but also would patent holders in general be encouraged to litigate.”
On Monday, Mueller had already predicted in his blog that McCreevy would soon declare himself in support of the EPLA: http://www.no-lobbyists-as-such.com/florian-mueller-blog/mccreevy-epla/
But Mueller was surprised that Nokia’s Tim Frain voiced a skeptical position on the EPLA, outlining six concerns including among others comparative costs, the quality of judicial decisions, and a need to balance the interests of right holders and alleged infringers. Frain said the EPLA in its proposed form is “good for right holders” and pointed out that Nokia is not only a plaintiff in patent suits but sometimes also a defendant. Nokia, like the vast majority of patent holders, usually enforces a patent only in one country at a time, and is worried about disruptive effect a Europe-wide injunction could have on its business.
The audience at the hearing consisted of an estimated 200 lawyers, lobbyists and government representatives. The Commission gave more than 50 people an opportunity to speak out, and the vast majority of them backed the EPLA, among them patent attorneys from EADS, Bosch, Qualcomm, Siemens, and Thomson. But the opponents of software patents, including Austrian Green MEP Eva Lichtenberger, complained in their speeches that their movement was grossly underrepresented.
Several speakers at the hearing, including the Fraunhofer Institute (which invented the MP3 format) and ProTon, an organization of university researchers, complained about the lack of patent protection for software in Europe under the current regime and were among those who strongly demanded the ratification of the EPLA.
The legal status of software patents in Europe is contradictory. While the existing written rules, which go back to the year 1973, disallow patents on computer programs “as such”, the European Patent Office (EPO) and various national patent offices have granted tens of thousands of software patents. However, European patents, even if granted by the EPO, can only be enforced country by country as of now, and national courts declare many EPO software patents invalid when their holders try to use them against alleged infringers. Critics argue that the EPLA would create a new court system that would be under the control of the same group of government officials who already govern the EPO, and that the judges appointed by those people would support the EPO’s granting practice and its broad scope of patentable subject-matter with respect to software and business methods.
Last week, the European Commission published a preliminary evaluation (http://ec.europa.eu/internal_market/indprop/docs/patent/preliminary_findings_en.pdf) of the responses it received to a patent policy questionnaire published in January. The Commission’s questionnaire addressed different policy initiatives, first and foremost the unitary “Community patent”, a patent that would be valid across the entire EU. But the Commission’s preliminary findings indicate that disagreement over the language regime of such a Community patent has thus far prevented the EU from moving forward with the project. The Commission’s analysis shows that industry organizations show a strong preference for the EPLA instead.
Mueller also expects (http://www.no-lobbyists-as-such.com/florian-mueller-blog/ecj-epla/) that one of the next steps will be for the European Commission to ask the European Court of Justice for an opinion on whether the ratification of the EPLA requires direct involvement on the part of the EU or whether any EU member states would be free to conclude the EPLA on their own. The EPLA’s proponents would prefer to eliminate the need to reach a decision at the EU level, fearing that the European Parliament might once again wreck their plans.
Posted in Uncategorized, Patents, EU & EU Member States Politics, Information & Communications Technology Policy, Miscellaneous, Intellectual Property Rights | Comments Off
European Commission may ask European Court of Justice for opinion on EPLA ratificationJuly 10th, 2006
As I explained in my previous blog entry, EU internal market commissioner Charlie McCreevy is going to announce pretty soon that he wants to help to get the European Patent Litigation Agreement (EPLA) ratified. The EPLA is a new attempt to make software and business method patents more enforceable in Europe, and beyond that effect, it would generally encourage certain types of patent holders to litigate.
But there’s a technical problem (”technical” in terms of “legally technical”): The European Commission’s legal services say the EPLA is a so-called “mixed agreement” that the member states of the EU cannot conclude on their own: they need the EU involved. To be very precise, it’s not the EU (European Union), but the EC (European Community, formerly called European Economic Community) that has to do this. However, for the purposes of this blog, I’ll just talk about the EU (it’s about the same set of member states anyway).
The Commission’s legal services say that the EPLA interacts with parts of the acquis communautaire (the totality of existing EU law), in particular Regulation 44/2001 (”Brussels I Regulation” on jurisdiction) and Directive 2004/48 (intellectual property rights enforcement). There is a rule in the EU that if a certain field of law has already been regulated by the EU, the EU member states must not enter independently intointernational treaties that affect the same law because conflicts might arise sooner or later.
The Commission’s position is shared by, among others, Klaus-Heiner Lehne, an influential conservative MEP (Member of the European Parliament), but not by the proponents of the EPLA. A number of them, including the Brussels-based lobbying organization EICTA, claim that the EPLA is perfectly in line with the acquis communautaire. And they stress that negotiations on the EPLA began years before the two aforementioned pieces of EU law took effect, claiming that the European Court of Justice (ECJ) has previously allowed EU member states to move forward on their own with an international treaty because the beginning of negotiations predated the affected parts of the acquis communautaire. There are some other theories as well.
The motivation on the part of the pro-EPLA movement is obvious: They want the EPLA to be ratified, and it’s easier for them to get a number of countries (possibly even just two, such as Germany and another one) to do so directly. As soon as the EU is involved, certain decisions have to be taken at the EU level. And for decisions in the EU, you either need (depending on the type of decision) unanimity in the EU Council (i.e., the votes of all member states, which means that presently 1 out of 25 countries could block the decision) or a qualified majority (much more than 50% of the votes) in the Council plus the support of the European Parliament. The software patent directive failed because of the latter requirement: the EP voted it down.
That’s exactly what the proponents of the EPLA fear, and they believe it’s easier for a couple of countries to get started with the EPLA. National governments could agree on such a deal in direct negotiations (at a diplomatic conference), and could then have their national parliaments (in which the government parties typically have a majority) ratify the deal. The EPLA would only take effect in those countries which ratify it, of course. In the EPLA, a minimum number of countries would have to be defined for the agreement to take effect, and that number has not been agreed upon thus far, but some even said two countries might be enough if one of them is large (such as Germany, which is very keen to get the EPLA ratified).
Even though the proponents of the EPLA would like to lower the hurdle for ratification, most of them (except for a very few die-hard radicals) would rather not take their chances. If some EU member states pressed ahead with the EPLA in breach of their EU-related obligations, the ECJ might later rule that their having ratified the EPLA took place on illegal grounds. That would be a nightmare, especially if it were to occur at a point in time at which the European Patent Court (which would be created under the EPLA, but outside the EU) might already have adjudicated a number of cases: those rulings might then become invalidated, at least as far as the EU is concerned.
At this EPLA-focused conference in London on June 30 (i.e., 10 days ago), Jacqueline Minor, a high-ranking Commission official (her title is “director, knowledge-based economy”), made a presentation. In her talk, she mentioned the possibility of the Commission obtaining an ECJ opinion under Article 300(6) of the Treaty Establishing the European Community (”EC Treaty”) beforehand. That paragraph says the following:
The European Parliament, the Council, the Commission or a Member State may obtain the opinion of the Court of Justice as to whether an agreement envisaged is compatible with the provisions of this Treaty. Where the opinion of the Court of Justice is adverse, the agreement may enter into force only in accordance with Article 48 of the Treaty on European Union.
The second sentence basically means that if the ECJ says a proposed agreement (such as the EPLA) is not in line with the EC Treaty, the EC Treaty has to be modified, which requires a unanimous decision by the EU member states.
I’m pretty certain that the Commission is going to obtain the ECJ’s opinion on the EPLA. I have no doubt McCreevy wants the EPLA ratified, and even though the Commission as a whole would, for institutional reasons, not view favorably the conclusion of the EPLA without the EU’s involvement, I think McCreevy personally would love the idea of lowering the hurdle for the ratification of the EPLA. And if the ECJ says the EU has to be involved, then no one can blame the Commission for having had a correct legal opinion. The Commission and particularly McCreevy only have something to gain and nothing to lose by asking the ECJ for an opinion, so I can’t imagine they wouldn’t do it. Even most of the proponents of the EPLA would very much prefer to have legal certainty, one way or the other.
Dr. Minor said in her speech that the ECJ can deliver such an opinion within three to six months. But there’s no guarantee: it can always take longer.
When the Commission will formally ask the ECJ for an opinion is another question. Maybe McCreevy will already announce this at the hearing on Wednesday. Maybe he’ll do so at some point after the summer vacation season.
There are also some question marks concerning the status of the EPLA-related documents that the ECJ would have to analyze. There is a draft EPLA, but it contains placeholders because some questions have not yet been resolved and would have to be hammered out at an intergovernmental conference. There is also a draft statute for the EPLA court, but there are no Rules of Procedure for the EPLA court yet. The Commission might first ask the intergovernmental working party that negotiates the EPLA to get its act together and present a final set of proposed documents (possibly even including the Rules of Procedure) for the ECJ to decide on. Or if the Commission asks the ECJ on the current basis, the ECJ might be unable to provide a definitive opinion for the lack of a complete and final set of EPLA documents.
Posted in Uncategorized, Patents, EU & EU Member States Politics, Information & Communications Technology Policy, Miscellaneous, Intellectual Property Rights | Comments Off
No doubt: EU Commissioner McCreevy is determined to back the EPLA (European Patent Litigation Agreement)July 9th, 2006
Superficially, it appears that the European Commission is going to evaluate the 2,500+ replies it received to its January 2006 questionnaire on patent policy as well as the input it will receive at this coming Wednesday’s (July 12) hearing prior to deciding how to move forward in the area of patent policy.
However, it would be naive to believe there is even the smallest doubt as to what EU internal market commissioner Charlie McCreevy intends to do. He has decided on that a long time ago, at least a number of months, possibly as early as last fall.
McCreevy has a new game plan after his failure to push the software patent directive through last year. That directive was not his baby originally: it was part of his predecessor Bolkestein’s legacy. But my book gives various examples of how McCreevy tried to outmanoeuvre and misinform the European Parliament, especially in the chapter titled Democracy Under Siege. In my book you can also read more about why McCreevy and the Irish government he belonged to (and which practically appointed him to the EU Commission) are particularly close to the business interests of Microsoft and a few other large American corporations.
I am going to say in my short speech at the upcoming hearing: “The EPLA [European Patent Litigation Agreement] is just another attempt to give software and business method patents a stronger legal basis in Europe than they have now. […] From a software patents point of view, the EPLA would have far worse consequences than the rejected patentability directive would have had: not only would software patents become more enforceable in Europe but also would patent holders in general be encouraged to litigate.”
That’s why Microsoft and the other usual suspects who supported the software patent directive have already done some lobbying for the EPLA in the European Parliament and the member states of the European Union. Now they’re just waiting for McCreevy to jump on the bandwagon, and I’m sure they won’t have to wait too long. It’s for no other reason than political etiquette and a desire to appear open-minded that McCreevy has not yet stated expressly what he wants to do.
After the political summer hiatus, the Commission is going to make its official recommendation based on the consultation process that will effectively end with the July 12 hearing. In September or in the fourth quarter of 2006, McCreevy’s going to say he’d really love to move forward with the so-called Community patent if only he could, but unfortunately there’s not enough political backing for the Commission’s related proposal in the short term,. But then he’s going to reiterate that patent policy is way too important an area to leave untouched for too long. So, he’ll say, given the tremendous demand expressed by stakeholders (i.e., large corporations and patent bureaucracies) for the EPLA, he’s going to support that one, even though (which he’s not going to say clearly, but probably hint at between the lines) the EPLA flies in the face of the EU’s usual philosophy, being a non-EU initiative that calls into question the commitment of many politicians, such as McCreevy, to the EU’s own court system and the notion of the Single Market. And even though that would be the very opposite of the truth, he might additionally claim the EPLA would pave the way for the Community patent.
What I just said I didn’t say after looking into a crystal ball, nor is it guesswork. It’s pure logic, and the statements made by McCreevy and his directorate-general (the Internal Market & Services DG) leave no doubt. Let’s analyze their latest declarations together, and you’ll understand:
In this speech before the European Parliament’s Legal Affairs Committee (”JURI”) on June 21, McCreevy said: “The hearing will focus on four topics: the principles and values that underpin the patent system; the proposed Community patent; non-Community initiatives such as the London Protocol and the European Patent Litigation Agreement (EPLA); and possible areas for harmonisation at Community level.”
Since the first of the four topics is just general talk and kind of unrelated to any initiative, this leaves three possibilities for what the Commission might propose to do: another push for the Community patent; a push for the EPLA; a new EU directive related to patent law, similar to the software patent directive that the European Parliament threw out a little over a year ago.
Actually, the very first option in politics is always to do nothing, to retain the status quo in a field. But McCreevy ruled that one out in the very same speech, saying toward the end of the section that discusses patents, “One thing is certain, progress in the patent field has to be made.”
So if he clearly wants to do something, which of the three proposed initiatives would he support? He himself said in that same speech, “The Community Patent remains blocked in the Council pending a solution on the language regime.” That’s old news. On May 18, 2004, the same day the EU Council reached a political agreement on a proposal for a software patent directive, the last negotiations on the Community patent took place. Nothing has happened in more than two years since.
Last week the Commission published a preliminary evaluation of the responses it received to its patent policy questionnaire. In that document, the Commission says that there is, in general, support for the community patent. However, the Commission also states that there is a fundamental disagreement over the language regime, i.e., in how many (and which) languages a patent document needs to be translated in order for the patent to be enforceable across the entire EU. That’s why negotiations stalled more than two years ago, and it’s easy for the Commission to claim that there’s still no way to resolve that problem.
On the last possibility (harmonization at the EU level), the Commission’s preliminary findings make it clear there’s no possibility of making progress: “There is very little support for harmonization. […] Mutual recognition is rejected almost unanimously at this stage.” Also, McCreevy reiterated in his June 21 speech that he won’t make a new proposal for a software patentability directive: “I will not bring a new initiative forward on this during my time as Commissioner for the Internal Market. I will leave this choice to my successor.”
By now we’ve already crossed all non-EPLA options off of the list. And what does the Commission say about the EPLA itself?
In his June 21 speech, McCreevy lamented the “regional distribution of courts” with respect to patent litigation in Europe, describing it as a competitive disadvantage vis-a-vis the US market. Under the EPLA, a new European Patent Court would be created, with a centralized appeals court. And he concludes the part of his speech that is related to patent policy with this statement: “[…] I think we should look at all possible routes forward, be they Community or non-Community initiatives.” That means to say: even though the EPLA is not a Community (i.e., EU) project, let’s try.
Welcome to the new war over software patents in Europe.
Posted in Uncategorized, Patents, EU & EU Member States Politics, Information & Communications Technology Policy, Miscellaneous, Intellectual Property Rights | Comments Off
What’s the gist of a hearing?July 9th, 2006
Yesterday I published the text of the short speech I’m going to give at the European Commission’s patent policy hearing on Wednesday (July 12). I think I should explain to the non-politicos among you what the term “hearing” means in this context.
Governments, quasi-governmental bodies (which is how I’d describe the European Commission, non-judgmentally) and legislators (for the most part, that means parliaments or subsets of a parliament, such as a committee or a party) frequently conduct hearings. At a hearing on a particular topic (in this case, patent policy), politicians and their staffs listen to people who are, personally or professionally, affected by a future decision. Obviously they can’t invite everyone who is or feels affected, so the organizers pick a limited number of participants who should ideally be representative of the different groups concerned.
Theoretically speaking, the dialogue between politicians and “stakeholders”, and the debate among stakeholders in front of politicians, should enable politicians to better understand the issue at hand and to arrive at a better decision.
Such hearings can take place in private or, such as in this case, in public, i.e., in front of an audience that typically also includes journalists. For the patent policy hearing, there was far more demand for seats in the audience than the Commission had available, so the Commission had to decide whom to invite.
In the political world, there are indeed some hearings that politicians approach with an open mind. But that’s the exception, not the rule. In most cases, a hearing is a little bit like a show trial, or to put it slightly less pejoratively, it serves the purpose of reaffirming the opinion the organizers have previously formed.
Hearings sometimes take place in the form of so-called roundtables. My book No Lobbyists As Such - The War over Software Patents in the European Union talks about a couple of such roundtables in which I participated. The roundtable format suggests that the dialogue should ideally result in some form of consensus, but in most cases, that’s impossible, and that fact turns a roundtable into just another kind of hearing.
The organizers of roundtables and other hearings try to display an open mind and a sense of pluralism by inviting a certain number of dissenters. However, the fact that someone listens to you in acoustic terms doesn’t mean he or she is going to really care about what you say, or that he or she is going to do anything for you.
So if those hearings are in most cases extremely unlikely to influence the opinion of the organizers, why would one participate?
There are multiple motivations, and in the particular case of a public hearing such as the one on Wednesday (July 12) in Brussels, it’s essential to make one’s case in front of the audience and the media. In a democracy, a political decision is the outcome of an opinion-forming process, and such hearings, especially if there is such tremendous interest in them as in this case, are key events. If the objective were to change the Commission’s thinking, it would be a waste of time and money to go there. After all, they already know my position paper (and those of all other speakers as well). But there are many other decision-makers and opinion leaders around, such as several MEPs (Members of the European Parliament). The Commission is very powerful, but it does not have legislative authority per se.
Posted in Uncategorized, Patents, EU & EU Member States Politics, Information & Communications Technology Policy, Miscellaneous, Intellectual Property Rights | Comments Off
Manuscript for my speech at the European Commission’s upcoming hearing on the future of the European patent systemJuly 8th, 2006
This coming Wednesday (July 12), I am going to speak during the litigation part of the European Commission’s patent policy hearing in Brussels. The hearing marks the end of a consultation process that began in January when the Commission published a questionnaire, in reply to which I wrote a position paper. At the hearing I am going to deliver the following short speech:
Ladies and Gentlemen,
Some of you may already know me as the founder of the NoSoftwarePatents campaign, but let me start by introducing myself a little more specifically. I’m an independent software developer. Commercial software, that is - not open source. In addition, I am here to represent three companies: 1&1 Internet AG, which is Europe’s largest Web hosting company; Materna GmbH, an IT and telecommunications company; and MySQL AB, Europe’s largest open source software company. All three of those companies hold European software patents and are well aware of the problems that patents create in their markets.
My corporate partners and I definitely don’t share the enthusiasm for the EPLA that some others have expressed.
All that talk about optimizing the European patent system is nothing more than a pretext. Only in five to ten percent of all cases, parallel litigation involves the same patent in more than one European country. In all other cases, even the estimates of the proponents of the EPLA - such as an impact assessment by the European Patent Office - suggest a doubling or tripling of the total cost of litigation. That would disadvantage smaller companies in two ways: the prospect of expensive litigation would force them to settle on unreasonable terms if someone threatens to sue over an alleged infringement, and if they would like to enforce their own patents, they might not be able to afford it. In some industry segments, the patent system already has the effect that “might makes right”, and the EPLA would exacerbate that very problem.
The actual motivation behind the push for the EPLA is this: it’s all about handing control over the judicial system - as far as patents are concerned - to the same group of people that governs the European Patent Office. Many patents that the EPO grants are declared unenforceable by the national courts that presently rule on infringement matters and make the final decision on the validity of a patent within their territories. In particular, national courts don’t tend to support the EPO’s practice of granting disguised software and business method patents. That fact is the only reason we don’t have US-style problems with software patent litigation in Europe yet.
There are special interests that previously tried to make software and business method patents enforceable in Europe, and a little more than a year ago, the European Parliament put an end to that effort by rejecting an ill-conceived proposal for a software patent directive. The EPLA is just another attempt to give software and business method patents a stronger legal basis in Europe than they have now.
Under the EPLA, the same group of people who control the EPO would get to appoint, and to periodically reappoint or dismiss, the judges. That same group negotiated the rejected software patent proposal in a working party of the EU Council, so we know all too well where they stand: they are infinitely more interested in growing the patent system than they are committed to Europe’s economic growth. Even worse, employees of the EPO would be allowed to serve simultaneously as judges on the EPLA court. For the sake of judicial independence, the proposed EPLA must not come into effect.
From a software patents point of view, the EPLA would have far worse consequences than the rejected patentability directive would have had: not only would software patents become more enforceable in Europe but also would patent holders in general be encouraged to litigate.
If the objective is to make Europe’s economy more competitive, we don’t need a system that makes litigation a more attractive option. We don’t even need cheaper patents: if SMEs have problems with the patent system, it’s not because of their own access to patents but due to the patents others can use against them. What we really need is fewer patents, and I don’t see a strategy on the part of the Commission to counter the trend of patent inflation.
Last year, the EPO received more than 180,000 patent applications. If the past is any indication, those 180,000 applications will result in about 90,000 new patents. (The EPO granted “only” about 50,000 patents last year, but that’s because it has a backlog and hasn’t been able to catch up yet. Examination takes several years.)
The fewest of those new patents relate to true inventions that justify the grant of a 20-year monopoly. In most cases, someone invented a patent instead of patenting an invention. Addressing that problem should be a far higher priority to the Commission and to Europe’s legislators than strengthening the position of certain types of patent holders.
Thank you.
Posted in Uncategorized, Patents, EU & EU Member States Politics, Information & Communications Technology Policy, Miscellaneous, Intellectual Property Rights | Comments Off
Evidence for Mark Webbink’s pro-patent directive lobbying on July 5, 2005July 3rd, 2006
In my previous blog article, I mentioned the fact that Red Hat’s deputy general counsel, Mark Webbink, lobbied in the European Parliament on July 5, 2005 (the day before the EP’s decisive vote to reject the software patent bill) to keep the software patent directive alive.
I had not anticipated the kind of Internet debate that this statement would trigger, including some insulting emails that were sent to me, and least of all I would have expected Mark Webbink to call into question the “veracity of [my] statements”, which is what he did in the discussion below this LWN.net article. He knows exactly what he did.
The word “motivations” also appears in that posting. It’s really simple: on the occasion of a patent suit having been filed against Red Hat, I thought it was time to tell the truth. Especially the free and open source software (FOSS) community should know where certain key players stand. That will better enable people to take a critical perspective on such initiatives as the OSDL Patent Commons.
Contrary to what Mark Webbink claims, my related statements are not “unverifiable”. What he did on July 5, 2005 is a well-documented fact, and here’s some evidence:
From: [name and address of adviser to Michel Rocard MEP deleted]
Sent: Monday, October 31, 2005 2:53 AM
To: Florian Mueller
Cc: europarl-help@ffii.org
Subject: Re: Economist article — coordinated response needed
[cut]
Yes. The day before the vote, as I had been considered
by them as somewhat connected to Mr Rocard 8^) , I
have been quite heavily lobbied by a group comprising
Mrs Thornby-Nielsen (Sun), Mrs Moll (Google), Mr Webbink
(RedHat) and Mr Cox (IBM). All four had basically the
same concerns
[cut]
I have removed parts of the email and in particular the name of the author, further to his request. He would prefer to stay in the background, like many political advisers do. But europarl-help@ffii.org is a key mailing list of European anti-software patent activists, and dozens of people received that email directly. No one will seriously question its authenticity.
And here’s an important excerpt from a follow-up email:
From: [name and address of adviser to Michel Rocard MEP deleted]
Sent: Monday, October 31, 2005 1:44 PM
To: Florian Mueller
Cc: europarl-help@ffii.org
Subject: Re: Economist article — coordinated response needed
[cut]
> They were against the rejection deal, right? I know that Mark W. and
> Charlotte T.-N. didn’t want rejection.
It seemed so to me. All of them. Basically, it seemed
to me they were not likely to have no sotware patents
at all. The interpretation I gave Mr Webbink was that
it is not culturally acceptable, for most people that
come from the legal and patent world, to reject a system
from which one can make some money…
[cut]
I believe the above should eliminate all reasonable doubt about what happened that day. While the FFII and I were asking everyone we knew in the European Parliament to reject the proposed software patent directive, Red Hat’s Mark Webbink, along with representatives of IBM, Sun and Google, pushed in the opposite direction.
So what did he really want to achieve? Someone pointed me to an article Mark Webbink wrote and which in its paragraph #20 refers to the EU software patent directive. He asks for a definition of the term “technical contribution” (a key term in patent law) that “will eliminate the vast majority of business method patents and will restore a substantial non-obviousness test to software patents”. If you read that carefully, it means he accepts software patents per se. He’d just like to raise the bar a little bit, and the FFII and I and all others who know how substantive patent law is applied in practice can tell you that defining “technical contribution” properly would not be a sufficient measure. It would just have the desired effect as part of a coherent framework of patentability criteria. Otherwise it’s like a bucket has five holes and you close one: all of the water will still go through the other holes.
In the same article, and in the Red Hat/Sun position paper that Mark Webbink published again on LWN.net, a lot of emphasis is put on an interoperability privilege. That, again, means to accept the patentability of software per se, but to demand a carve-out for certain purposes. To the FFII and myself, interoperability was not even a secondary priority. We focused on the definition of what is patentable and what is not. If software is not patentable at all, there’s no pressing need for an interoperability exception as far as we’re concerned. Interoperability was exactly the area in which the pro-software patent forces were most wiling to make a concession if it allowed them to win the wider battle.
Finally, I’d like to reiterate what I said in my previous post: What Mark Webbink did behind the scenes is not necessarily Red Hat’s position as a company, even though Red Hat has entrusted him with patent lobbying. There are many people at Red Hat who clearly oppose software patents, and who opposed the EU software patent directive, most of all Alan Cox.
Posted in Uncategorized, Patents, EU & EU Member States Politics, Information & Communications Technology Policy, Miscellaneous, Intellectual Property Rights | Comments Off
Patent infringement suit filed against Red HatJune 29th, 2006
The Patently-O blog reported yesterday that a software company named FireStar has sued Red Hat over an alleged patent infringement. Patently-O also provides the complaint and the patent document, and quotes from Red Hat’s patent policy. The FireStar suit relates to a piece of software that Red Hat acquired as part of JBoss Inc.’s intellectual property.
It seems to me that the FireStar patent is quite broad, and if it is upheld, it will affect other companies as well. While I know that certain parts of the free and open source software (FOSS) community don’t like to hear this, I have repeatedly stated that FOSS projects and products are particularly threatened by software patents. In this specific case, however, the fact that an open source program is at the center of a patent infringement suit appears to be a coincidence.
Red Hat was one of the three companies who provided the initial funding for my NoSoftwarePatents.com campaign. I will always be grateful for that, and naturally I can’t talk in public about confidential aspects of the working relationship I had with Red Hat at the time. Suffice it to say that the working relationship ended, and while the other two sponsors (1&1 Internet AG and MySQL AB) continued to support me on a couple of other occasions, things didn’t work out with Red Hat again.
I have since watched Red Hat’s role in the political debate on software patents. At first sight, Red Hat appears to continue to take an anti-software patent position. Also, Red Hat made an effort last year to convince some of the large FOSS-friendly IT companies such as Sun to dissociate themselves from some of the pro-software patent propaganda spread by certain lobbying entities.
However, a few months after the European Parliament’s historic vote against the software patent directive, an adviser to a key MEP (Member of the European Parliament) told a private FFII mailing list that Red Hat’s deputy general counsel Mark Webbink lobbied him on the day before the decisive vote and tried, unsuccessfully, to prevent the rejection of the software patent directive by the parliament. Yes: A Red Hat executive lobbied for the EU software patent directive at the 11th hour (on July 5, 2005, to be precise), alongside such companies as IBM and against the position taken by the anti-software patent movement. That’s a fact. It doesn’t mean to say that Red Hat as a whole is in favor of software patents, but it says a lot about the person who did this.
Red Hat has meanwhile been at the forefront of all sorts of placebo initiatives designed to alleviate patent-related concerns of open source developers and users, such as the OSDL’s Patent Commons. Depending on how the FireStar suit evolves, Red Hat may have to answer the question whether it grossly overstated the benefit of those initiatives to open source developers and users. Apparently, the patent projects supported by Red Hat haven’t really discouraged FireStar from suing.
Posted in Uncategorized, Patents, Information & Communications Technology Policy, Miscellaneous, Intellectual Property Rights | Comments Off
First set of error and typo corrections to my book on the war over software patentsJune 25th, 2006
Today I uploaded version 1.01 of my e-book, No Lobbyists As Such - The War over Software Patents in the European Union. I just corrected a few minor errors and would like to express my gratitude for the corrections submitted by Alberto Barrionuevo and Péter Somogyi.
Posted in Uncategorized, Patents, EU & EU Member States Politics, Information & Communications Technology Policy, Miscellaneous, Intellectual Property Rights | Comments Off
Published my book electronically, under a Creative Commons licenseJune 6th, 2006
My book No Lobbyists As Such - The War over Software Patents in the European Union is now available for download: www.no-lobbyists-as-such.com/NoLobbyistsAsSuch.pdf
The PDF file has a size of approximately 2 megabytes. In order to read the document, you need Adobe Acrobat Reader. By the way, I have also published a German edition of my book on www.softwarepatente-buch.de.
Originally I had planned to self-publish my book in print. After the official announcement of my book in late March, I received inquiries, especially for an electronic version, from literally all over the world, even including universities in the US, Europe, Asia and Australia. However, it seemed that print publishing wasn’t going to work too well: there is an audience for this, but it’s geographically scattered.
When I wrote the book, I didn’t have the expectation of making money with it. I wouldn’t have wanted to leave money on the table (nobody does). However, what matters to me more than anything else in this respect is to get my book out to a large audience, especially since the next major war over software patents in Europe will officially break out on July 12 at a hearing to be held by the European Commission in Brussels. The same forces who supported the software patent directive we successfully fought against are now trying to achieve everything they wanted the last time, and even more, by means of the European Patent Litigation Agreement (EPLA). I hope my book will motivate people to take action against the EPLA, an international treaty that would have far worse consequences than the software patent directive would have had.
I chose the Creative Commons Attribute - NonCommercial - NoDerivatives license. It allows the free distribution of the PDF file in accordance with these rules. Commercial exploitation or any modification would require my consent.
I hope many of you will enjoy the book. Reading almost 400 pages on a screen may be a bit inconvenient. What I actually recommend is that you print it out with a laser printer.
Posted in Uncategorized, Patents, EU & EU Member States Politics, Information & Communications Technology Policy, Miscellaneous, Intellectual Property Rights | Comments Off
Senior researcher at Chinese Ministry of Commerce believes software patents stifle innovationMay 28th, 2006
The FFII’s Swpatcnino page continues to be the most up-to-date and complete collection of links to news items concerning software patents. Here’s an interesting article that I became aware of on that page: Shanghai Daily - IPR protection hot potato not black and white
The article talks about IPRs (intellectual property rights) in general, and patents are only one of the legal devices that are counted among them. With respect to software, I prefer a clear distinction to be made between copyright and patents, and only in a few exceptional cases I consider it accurate to refer to copyright, patents and other rights by the collective term IPRs.
A significant part of the article, which was written by a senior researcher at the Chinese Ministry of Commerce, narrows in on software patents, stating that the US approach to software patents “is in fact discouraging technological innovation on the whole”.
Since the granting practice of the European Patent Office (EPO) with respect to software is only superficially but not essentially different from that of the US Patent and Trademark Office (USPTO), the same criticism would also apply to the European approach. However, the difference is that software patents are often enforced successfully in the US, while the national courts of key European countries such as the UK and Germany are rather reluctant to support the EPO’s absurd interpretation of Europe’s existing statutes in the field of substantive patent law (substantive patent law = rules as to what can and cannot be patented).
Entities with anti-competitive ambitions, such as Microsoft, SAP and various lobbying organizations controlled by them and similar players, now aim to change the European judicial system with respect to patents so that they will in the future be able to enforce their software patents on a large scale. They failed miserably last year with trying to push the EU software patent directive through, and their latest scheme is the European Patent Litigation Agreement (EPLA).
Posted in Uncategorized, Patents, Information & Communications Technology Policy, Intellectual Property Rights | Comments Off
Euro software patent spat re-starts
Vole scampering in the €urolobbies
By INQUIRER staff: Tuesday 11 July 2006, 11:28
http://www.theinquirer.net/default.aspx?article=32947
SOFTWARE PATENT campaigner Florian Mueller said the dispute over patent policy is set for a replay starting tomorrow.
Mueller spearheaded a successful campaign that ended when the European Parliament voted down a software patent directive a year ago.
But, he said, the European Commission will hold a public hearing on the future of the Euro patent system in Brussels tomorrow.
Now, however, a proposal to introduce a European Patent Court to adjudicate over the European Patent Litigation Agreement (EPLA) is the bone of contention.
Mueller and the Foundation for a Free Information Infrastructure will attack the EPLA, facing down Microsoft, Nokia and other multinationals.
Mueller claims that EU internal market commissioner Charles McCreevy is "determined to back the EPLA," while "Microsoft and the other usual suspects" have been busy lobbying members of the Euro parliament.
Mueller claims that the EPLA will have "far worse consequences" that the rejected patent directive. Patent holders will be encouraged to litigate, while the cost of litigation will go through the roof. µ
EU promotes new patent war, claim
Ducks quack at €uromarket
By INQUIRER staff: Thursday 13 July 2006, 09:36
http://www.theinquirer.net/default.aspx?article=33002
INTERNAL MARKET commissioner Charles McCreevy has sided with industry monopolist Microsoft and other IT multinationals, sparking a new software patent furore.
That's according to anti-software patent veteran Florian Mueller, who said that a hearing in Brussels on the future of patent policy showed McCreevy siding with the lobbyists by supporting the European Patent Litigation Agreement (EPLA).
Mueller said he spoke out against the proposals at the forum yesterday. He claimed the EPLA was "just another attempt to give software and business method patents a stronger legal basis in Europe than they have now. The EPLA [will] have far worse consequences than the rejected patentability directives would have had".
He said software patents would become easier to enforce in Europe and patent holders would be encouraged to go to law.
The forum had around 200 attendees including lobbyists, lawyers and government reps, with 50 people speaking, most of them backing EPLA.
Mueller said speakers included patent lawyers from EADS, Siemens, Qualcomm, Bosch and Thomson. But, said Mueller, Austrian MEP Eva Lichtenberger complained that the movement against the EPLA was under represented.
More on Mueller's bog, here. µ
See Also
Euro software patent law restarts
Calling Qualcomm
By Steven Smith
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There was a large transaction this morning in July $40 call options for Qualcomm -- over 2,700 contracts traded, with the bulk occurring in blocks of 500. Prior open interest in the strike of 27,000 contracts is sufficient to cover, but I have a feeling someone is selling the calls to...
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EU defends roaming ‘climbdown’
http://www.eupolitix.com/EN/News/200607/6146eaea-e7d3-4240-afd8-190b72983fd7.htm
EU defends roaming ‘climbdown’
José Manuel Barroso has rebutted claims that new EU proposals on cutting mobile phone costs have been watered down under industry pressure.
The European commission president has repeatedly highlighted the EU’s determination to cut the “excessive” cost of international roaming as a prime example of a “Europe of results”.
But he was forced to defend this stance on Wednesday after the commission unveiled plans that appear to let mobile phone operators off the hook.
“What we said we would do, we are delivering, and I am proud of that,” he told journalists, claiming that more than 147 million EU citizens would benefit from roaming charges that would be up to 70 per cent lower than at present.
Barroso, along with EU media commissioner Viviane Reding, unveiled plans to cap the cost of wholesale roaming – the charges made between operators – at no more than 30 per cent above the basic cost.
But plans to impose a similar cap on retail prices – the price paid by consumers to operators for making calls – will only come into force six months later.
And a proposal to ban companies from charging customers to receive calls when abroad has been scrapped and replaced with a maximum charge.
Mobile operators will also be obliged to inform customers via SMS or a free call of the roaming tariffs in force in each particular country.
‘Compromise’
Barroso defended the revised proposals, which he qualified as a “compromise”, on the grounds that the EU has the duty to defend the interests of its businesses as well as its citizens.
“We are proud of the EU telecommunications sector, and rightly so, and we do not want to do anything that would harm its competitiveness. We listened to both industry and consumers, who urged us not to go too far, so we made our plans more balanced.”
“We have effectively created a European market for mobile telephony. Competition is working well in national markets, which are regulated by national regulators. But only the EU can regulate the cross-border market and make sure competition is working.”
The commission’s proposals would see the cost of calling home from abroad drop to no more than €0.49 a minute, compared to around €1.50 a minute at present.
Local calls – made within the same foreign country – would be capped at €0.33 minute, while the cost of receiving a call would be around €0.16 a minute.
Starting point
Reding explained that her initial proposal that all international mobile calls should cost no more than an equivalent national call had been little more than a starting point.
“I have been a politician long enough to know that you never put your final version on the table at the beginning.”
“You start with the biggest picture and then negotiate.”
But she stressed that her repeated calls for action from the mobile industry had been ignored for too long, and that she had been right to propose regulation.
“There was no clear link between the cost of roaming and the retail price. In some cases, it cost the consumer five times more than the operator. This was unacceptable.”
“But we do accept that there are some costs entailed in roaming, and this new proposal takes these into account.”
Commission rift?
Press reports suggested that a rift between Reding and several other commissioners, including enterprise chief Günter Verheugen and trade commissioner Peter Mandelson, had threatened to capsize the commission’s consumer-friendly proposal, forcing the change of tack.
Barroso confirmed that the debate in the college of 25 commissioners had been lively, with everyone having a say, and confirmed that all sides had had to compromise.
But he said the onus was now on the other institutions – the European parliament and the council of EU member states – to match the commission’s ambition.
“I expect strong support from parliament,” he said, but warned that some member states – especially those where major mobile phone companies were based – could resist the plans.
“Let’s see if all the governments share the same ambition as the commission. I’m afraid many of them won’t.”
Finland, home to Nokia, is the current EU president, but Barroso diplomatically said that the issue was “important to the Finns” and that he expected them to table the issue at council meeting as soon as possible.
Speedy resolution
The Portuguese commission president said that the speed with which the legislation could be approved by the other institutions was, in his opinion, a more important issue than whether the six-month period had let mobile operators off the hook.
“We are not postponing our plans, as I have seen suggested in some parts of the media. The cap on retail prices will be automatic and immediate after six months – any further delays will be in the co-decision process.”
“If companies act now to cut their costs, the legislation will not affect them, and I believe many will bring their prices down to well below the cap.”
“I can even envisage some companies offering roaming for free, as a means of beating the competition.”
Operators unhappy
But the reaction of mobile phone operators to the commission’s revised proposals would suggest that these halcyon days are still some way off.
“These new proposals would still do significant damage to the European roaming market and are not in the interests of consumers,” said the GSMA, which represents mobile phone operators.
“The commission’s plan to introduce a rigid cap on retail prices on each and every minute of a roaming call will stifle competition.”
“The price cap will prevent mobile operators from providing bundles of roaming minutes or other innovative tariff packages, which appeal to specific groups of customers and are an important feature of today's vibrant mobile marketplace.”
It also argued that the legislation was unnecessary. “The industry is delivering cuts in roaming prices today, well before any regulatory intervention would come into force.”
Consumers content
Consumer group BEUC was cautious in its praise for the commission’s decision. “Overall, the proposed regulation is a good first step in addressing consumer concerns in mobile communications markets,” said Jim Murray, BEUC director.
“But we will remain vigilant. We hope that operators will not try to find other markets where they can ‘prey’ on consumers. Constant monitoring of developments in other markets is therefore needed.”
Murray said that the threat of price caps after six months would push mobile operators to reduce their “extortionate roaming tariffs”.
“It would be naïve to hope that the same operators would suddenly be converted and voluntarily forego a part of their exorbitant roaming profits to the benefit of consumers,” without the price cap ‘stick’.
Parliament divided
Barroso confidence that the commission’s proposals would win the backing of parliament may be somewhat premature.
“The commission is thinking about this problem two-dimensionally. It should realise that if incumbent operators continue to charge high roaming costs, consumers will buy handsets with internet-calling technologies,” said centre-right MEP Syed Kamall MEP.
“The market is slowly sorting itself out and it should be left alone right now to find natural solutions to consumers’ concerns.”
“New technologies - such as Voice over IP (VoIP) - which are being built in to the next generation of mobile phones, will completely revolutionise international calling, and will act as the market solution to excessive roaming charges.”
But German centre-right deputy Angelika Niebler said the commission was “on the right track” by capping prices at a level that would allow companies to make a reasonable profit.
NTT DoCoMo to Start Sales of HTC Handset with Windows Mobile
Press Release posted by Michelle Ruhfass on Wednesday July 12, 2006.
http://www.mobileburn.com/pressrelease.jsp?Id=2555
TOKYO, JAPAN and TAOYUAN, TAIWAN, July 12, 2006 --- NTT DoCoMo, Inc. (DoCoMo) and High Tech Computer Corp. (HTC) announced today that they have developed a handset, “hTc Z” equipped with the Microsoft Windows Mobile 5.0 Japanese-edition operating system. DoCoMo will start sales in late July.
The hTc Z will enable a variety of useful mobile business solutions using Windows Server and Exchange Server, in addition to Bluetooth and many add-in applications.
DoCoMo plans to sell the handsets to corporate customers as part of its comprehensive business solutions.
About NTT DoCoMo
NTT DoCoMo is the world's leading mobile communications company. DoCoMo serves more than 51 million subscribers, of which more than half to FOMA launched as the world's first 3G mobile service based on W-CDMA in 2001. DoCoMo also offers a wide variety of leading-edge mobile multimedia services, including i-mode the world's most popular mobile e-mail/Internet service, used by more than 46 million people. With the addition of credit-card and other e-wallet functions, DoCoMo mobile phones have become highly versatile tools for daily life. NTT DoCoMo is listed on the Tokyo (9437), London (NDCM) and New York (DCM) stock exchanges. For more information, visit www.nttdocomo.com.
About High Tech Computer Corp.
HTC designs, manufactures and markets innovative, feature-rich smartphone and PDA devices. The company produces powerful handsets that continually push the boundaries to provide true mobility and freedom for its users.
Founded in 1997, HTC (High Tech Computer Corp.) made its name as the company behind many of the most popular operator-branded devices. It has established unique partnerships with key mobile brands, including the leading operators in Europe, US, and many fast-growing Asian operators. The company has also brought products to market with OEM partners and under its own HTC brand.
HTC is the leading global provider of Microsoft Windows Mobile-based devices and one of the fastest growing companies in the mobile device sector. HTC also ranked No. 3 among global IT companies in the 2006 Info Tech 100 from Business Week.
For further corporate information, please visit: www.htc.com
CDG Congratulates Telecom New Zealand on Commitment to CDMA2000 1xEV-DO Revision A
12th July , 2006
http://www.3g.co.uk/PR/July2006/3331.htm
US / NZ : The CDMA Development Group (CDG) congratulated Telecom New Zealand (TNZ) on its commitment to deploy CDMA2000(R) 1xEV-DO Revision A before the end of 2006. TNZ recently announced that CDMA2000 has proven to be a superior technology in delivering 3G broadband services. With EV-DO Revision A, their network capacity and performance will be further enhanced to enable additional competitive service offerings. The Revision A network will also provide TNZ with a smooth upgrade path to EV-DO Revisions B and C to begin offering ultra broadband services within the next few years.
"The CDG applauds TNZ's decision to bring this innovative technology to market," said Perry LaForge, executive director of the CDG. "In markets around the world, Revision A will demonstrate CDMA2000's greater performance, flexibility, and one to three year time-to-market advantage over competing technologies."
"Our decision to deploy Revision A reflects our desire to deliver the best performing and most cost-effective services to our subscribers," commented Kevin Bowler, general manager of consumer marketing, TNZ. "Revision A will allow us to offer richer, more compelling and faster mobile data services to our consumer and enterprise customers. They will be the first to experience the value of enriched multimedia communications and enhancements to enterprise productivity."
CDMA2000 1xEV-DO Revision A is an enhanced version of 1xEV-DO Release 0, a broadband wireless technology currently available from 36 networks across Asia, the Americas and Europe, with 37 more under construction. The key benefits of Revision A include:
-- Advanced services - Revision A enables the enhanced performance
of a large variety of real-time broadband, symmetric data link,
and delay sensitive (low latency) services such as voice-over IP
(VoIP), push-to-talk (PTT), push-to-media, video conferencing,
multicasting, and richly rendered 3D gaming with multiple players.
-- Improved Broadband speeds - Revision A increases the efficiency
and speed of existing EV-DO networks, resulting in an improved
user experience on existing applications. Peak download (forward
link) and upload (reverse link) data rates are increased to 3.1
Mbps and 1.8 Mbps, respectively, in a mobile environment. These
speeds will support a wide range of bandwidth-intensive
applications.
-- Increased Capacity - On both the forward and reverse link,
Revision A allows operators to support more users and it improves
the cost of delivering voice, data and multimedia services.
-- Symmetry - By increasing uplink speeds, Revision A will be the
first commercially available wireless technology to deliver a true
synchronic broadband experience. Symmetry is important for
applications where users send packets of data as often as they
receive them, such as receiving and sending email with
attachments.
-- Low latency - The average latency of Revision A is well below 50
milliseconds, making it ideal for delay-sensitive applications
such as VoIP, PTT, virtual private networks (VPNs), and
simultaneous voice and data applications.
-- Quality of service - Revision A enables the delivery of a wide
range of applications with different levels of priority using
enhanced Quality of Service (QoS) mechanisms. These mechanisms
will ensure a consistent, high-quality user experience.
-- All-IP - Internet Protocol (IP) is the foundation for all future
CDMA2000 radio access networks. Like 1xEV-DO Release 0, All-IP
Revision A networks will continue to enable operators to enjoy
additional service flexibility and higher bandwidth efficiencies,
which translate into greater control and significant cost savings.
-- Backward compatibility - Revision A networks support existing
Release 0 applications and devices. As a result, existing Release
0 customers will continue to drive revenue long after operators
have deployed Revision A. This backward compatibility preserves an
operator's previous network investments, and is particularly
important for enterprises who want to continue to leverage their
investment in EV-DO Release 0 equipment for years to come.
Leader: IT chiefs need mobile help
And mobile operators are now offering their assistance
By silicon.com
Published: Wednesday 12 July 2006
http://hardware.silicon.com/desktops/0,39024645,39160247,00.htm
O2 announced today it's changing its image. Out with last season's 'we're a mobile operator' look and in with some 'we're all IT now' garb. Smart move.
Given that mobility is becoming a top concern for IT departments, O2's promise to snuggle up to outsourcers, jaw with IT resellers and generally whisper the kind of pillow talk CIOs will love to hear seems like a good idea - and likely the start of a trend that other mobile companies will follow.
Mobile operators are waking up to the potential bounties they could collect from corporate IT departments, which would provide a reliable sales stream (unlike fickle consumers) and have a growing fondness for data services which bring in a high level of revenue per user (again, unlike consumers from whom mobile operators make very little on a per-user basis).
Mobile can no longer remain computing's poor cousin in perception or power.
Another good reason for operators to remodel themselves and another reason why CIOs will want them too - mobile devices are fast catching up with PCs in terms of functionality and require the same amount of TLC as their desktop counterparts. So it makes sense for an IT chief to have a mobile partner on hand to help out.
The growing similarity between mobile devices and PCs hasn't slipped under the radar of Qualcomm CEO Paul Jacobs either. Jacobs said recently the mobile phone poses more risk of disrupting the PC industry than the other way around, given the mobile may be the only computer many people in developing nations will have. Proof, if proof were needed, that mobile can no longer remain computing's poor cousin in perception or power.
We're with Jacobs on this one. Mobiles can only get more and more functional (and difficult to manage) as road warriors and remote workers demand the ability to tap into key apps from wherever they are. While uptake for the likes of mobile sales force automation or field force automation is lukewarm at the moment, once mobile email gets going properly, other apps will find themselves treading the hockey-stick adoption curve it has left behind a breeze.
And that can only mean IT departments will need all the help they can get from a mobile specialist.
Nokia and the Standards Battle in China (NOK, CHL, CHU)
Posted on Jul 12th with stocks: CHL, CHU, NOK
http://china.seekingalpha.com/article/13456
David Wolf submits: Nokia has been tossing a press release of sorts around China announcing that they are bringing DVB-H, the mobile television standard most favored by The Boys from Espoo, to China to test. They even have a single model of a phone that can actually use that standard for the eyebrow-raising price of RMB 6,000.
Welcome, DVB-H and Nokia. Glad you could join the party, especially since QUALCOMM has been here testing MediaFlo for at least two years, and the local team has managed to modify their Digital Multimedia Broadcast standard (DMB - I know, not the smartest acronym around, but go figure) to include wireless handheld devices.
If it has taken this long for Nokia to start testing, something is seriously wrong, especially since the word coming from the west end of Chang’an Avenue is that SARFT is about to crown DMB-T/H [grin] as the standard of choice for China. Nokia is basically showing up at the 11th hour.
Frankly, I think something much bigger is going on.
Gunfight at the T.V. Corral
Word around the campfire in Beijing is that China Mobile (CHL) and China Unicom (CHU) have actually been testing all of the standards for some time. What makes this particular standard decision different than, say, the decision on what 3G standard to use or what frequency allocation each standard will get is that this decision will NOT be made by the Ministry of Information Industries, or MII, the regulatory entity that oversees the telecommunications industry.
For complex political reasons I won’t go into here, the decision will be made by the State Administration for Radio, Film, and Television, or SARFT, because mobile television is seen by many senior government officials and Party cadres as a broadcast medium and thus under SARFT’s purview.
Now, I suspect the mobile handset manufacturing industry in China would like to see DVB-H or MediaFlo win, certainly not because of any deep love of either Nokia or QUALCOMM, but because these are international standards and phones made to use these standards are thus sellable overseas. If China can build a healthy market in DVB-H or MediaFlo phones, there are waiting markets overseas and the Chinese manufacturers would have enough economies of scale at home to be competitive abroad. In theory, at any rate. For carriers, the equipment is tested, in commercial use, and reliable, and thus good for business.
SARFT, on the other hand, likely favors the DMB standard because it has been reviewing it for terrestrial television broadcasts for some time, because it is a local standard (thus providing SARFT an opportunity to show its own overseers how it supports local innovation) and, frankly, because deep down inside they know that selecting it will cause a few cases of indigestion over at the MII.
Nokia - and the carriers - all know this. And it doesn’t make any of them very happy.
“Doc, Wyatt and I are Going to Check on the Horses. Wanna Come?”
So here is what I think is happening:
• The testing - from a technical standpoint, is done. That’s not what this is really about.
• Nokia applies for permission from SARFT for a test network, with a view of doing the test with (in all likelihood) China Mobile. SARFT won’t want to do it, but China Mobile will push very hard both at SARFT and the State Council to get Nokia permission, on the grounds that DVB-H deserves more than just a lab test.
• With such a test approved, it gets harder for SARFT to make an immediate decision about a standard. After all, testing is still taking place, right?
• The Test Network will be a “test” in name only. What it probably will be is a full commercial rollout in a limited geographic area. (After all, why announce a retail price for a handset if you’re just “testing” the network?) SARFT can’t cry foul on this because SARFT and entities under it use the “commercial test” method for technologies in television as well.
• Once the Test Network is up and running with customers paying for service, it gives the MII, China Mobile, and Nokia an opportunity to have greater influence in the final decision about a standard, and in the process of appealing SARFT’s selection at higher levels of government, like the NDRC or the State Council.
If this is the case (and mind you, I’m speculating here), Nokia is playing a dangerous game. It is not wise to interpose yourself between giants, and especially between organizations like the MII and SARFT. By fronting for its patrons in China, Nokia may well make itself some powerful entities. In a place where memories are long, the structure of the government is still evolving, and officials bounce around on a regular basis, that’s asking for trouble.
If I’m wrong, if there is nothing more to this than in the current release and Nokia is truly appealing to SARFT on its own behalf, then Nokia is far less China-savvy than even I had thought. Apart from the fact that this request should have been made a long time ago, it should have come from a local company, not a foreign enterprise. That would have made it much harder for SARFT to say no, and it would have put DVB-H on a more balanced footing with DMB.
Nokia’s China people know this. And that’s why this all seems so strange.
The Shots Heard Round The World
While seemingly esoteric, this fight has a profound importance that transcends the realm of the propeller-heads in the mobile phone business.
Sometime over the last year, something quite amazing happened. In the largest television market on the planet, with over 350 million TV households, the number of mobile phone subscribers surpassed the number of homes with televisions. At the same time, quietly, a small cottage industry has been growing around delivering both general and highly targeted marketing to multimedia-enabled mobile devices.
Meanwhile, a growing number of very large advertisers in China - and their agencies - are losing their patience with the rising advertising rates and the falling returns on spot television ads on Chinese television. They’re unhappy with having to fight harder for better air time, with the TV industry’s continued inability to deliver a ratings system anyone could swear by, and with growing evidence that Chinese are spending less time watching broadcast TV and more time on their computers and on the go.
The more visionary of those advertisers and agencies are taking a long, hard look at mobile TV (MoTV), China’s increasingly mobile population, and the ability to get more and more meaningful viewer information and feedback through mobile. This, understandably, worries the folks in the TV business. Even if they wind up supplying the content to mobile TV, they’re going to have to share their ad revenues with the carriers, and they’ll at best be in a weakened position when it comes to setting their rates.
We’re talking about potentially millions and eventually billions of RMB moving out of broadcast TV and into MoTV, more than enough to support the medium and to use China to make a global case for MoTV.
If a decision is made by SARFT - or someone who could override SARFT - to select a standard that is market-ready (like DVB-H or MediaFlo), MoTV could become a reality quite quickly, meaning that the shift of dollars would start taking place comparatively soon. If the decision was made to go with DMB - which still needs development work before it is commercially ready - the market would require many more years before MoTV became more than a blip for advertisers.
What is at stake, then, is the future shape of the Chinese Media Environment, and the flow of millions if not billions of U.S. dollars, completely disregarding any monies to be earned by royalties on technology, which could also run into nine or ten figures.
That’s a high stakes fight. And The Boys From Espoo are now squarely in the middle of it.
Good luck, Nokia. You’ll need it.
Consumers top '50 who matter now' list(Paul Jacobs is at 3rd Place after Sergey Brin and Larry Page )
Press Trust of India / New Delhi July 12, 2006
http://www.business-standard.com/common/storypage_c.php?leftnm=11&bKeyFlag=IN&autono=2891
"You! the consumers" top the list of "50 people who matter now" in July issue of Fortune group magazine Business 2.0.
The consumers of the world now matter more than anyone else, says the magazine. "They've long said the customer is always right. But they never really meant it. Now they have no choice".
Among those who have been placed above the emerging middle class in the list, Google founders Sergey Brin and Larry Page have been ranked second, Qualcomm CEO Paul Jacobs is at third place, News Corp CEO Rupert Murdoch is at fourth, Apple Computer CEO Steve Jobs at fifth and Genentech's product development president Susan Desmond-Hellmann has been placed at the sixth position.
Companies like Delta Air Lines and T-Mobile are turning to customers to create their ad slogans, while Procter and Gamble and Lego are incorporating consumers' ideas into new products, it added.
The magazine said in its cover story encompassing the top-50 list that the names present in the list were not selected on the basis of fame, net worth, or the accomplishments of yesteryear.
Venture capitalist of Indian-origin Vinod Khosla has grabbed the 33rd position in the list. Khosla is the co-founder of IT giant Sun Microsystems and is considered one of the most influential partners at top venture capital firm Kleiner Perkins Caufield and Byers.
While justifying the seventh rank of emerging middle class, the Business 2.0 magazine quoted a Goldman Sachs study that says that more than 800 million people in China, India, Russia, and Brazil will qualify as middle class in the next decade - meaning they will earn more than $3,000 per year.
This figure represents more than the combined population of the United States, Western Europe, and Japan. "These ambitious, well-educated workers represent both a threat and opportunity for corporate America. On the one hand, thanks to global competition, they're bringing brutal cost pressure to bear on US products.
Yet at the same time, these newly affluent consumers have money to spend - estimated at more than $1 trillion a year and they generally aspire to own American brands and other high-quality imports," it added.
"This emerging class is looking forward to enjoying a more comfortable way of life, and huge opportunities await the global firms that figure out how to deliver that at a price the workers can afford," said the magazine.
In another list of "10 people who don't matter", published in the same issue, Microsoft's CEO Steve Ballmer and Arun Sarin, the high profile Indian origin CEO of UK-based telecom major Vodafone, figure prominently.
"Not everyone with a fancy title really counts" and these are the "people you can safely snub at conferences," said the magazine, which is part of the global media conglomerate CNN-Time Warner group that also publishes Fortune, Money and Fortune Small Business magazines.
This list included names of people whose power had peaked, influence had waned, or whose true importance was overstated, Business 2.0 said.
These are the people who are worth billions of dollars, command big salaries and have impressive titles and among them are the creators of the Sony PlayStation, the DVD, and Linux. While they might be much respected for their past achievements, their best days are behind them, it added.
Qualcomm confident of bright future for mobiles
Jo Best
silicon.com
July 12, 2006, 10:40 BST
http://news.zdnet.co.uk/communications/3ggprs/0,39020339,39278577,00.htm
Despite the threat of technologies such as WiMax, Qualcomm's chief executive believes the mobile industry has little to fear
Paul Jacobs, chief executive of chipmaker and 3G IP giant Qualcomm, has revealed he believes the mobile industry has little to fear from IT, despite the advent of disruptive technologies such as VoIP and WiMax.
The phone, according to Jacobs, is the future of computing for developing nations. "It's the only computer most people will ever have. It's a darn powerful computer," he said. "It's incredible the capabilities that are going into the phones because of Moore's Law."
Current mobiles, he said, are gaining ground fast on their PC counterparts: "It's like a 1996 computer. The only thing that's missing is a large keyboard and large display and that's coming... it shows how disruptive the phone can be to the computing industry."
But the disruptive traffic is not all one way. Should the likes of WiMax take off and become the wireless connectivity standard du jour, as some industry watchers predict, 3G patent owner Qualcomm will be out-of-date in a cell-free world.
Qualcomm's chief executive, however, is banking on 4G being a multi-radio future where information is carried over whichever radio is the most appropriate at the time — a future that would give 3G a longer shelf life.
According to Jacobs, 3G shipments will beat 2G by 2009, although he's already sounding the death knell of what was once considered the Great White Hope of third-generation services. "I was never a huge believer in video telephony," he said.
Other next-big-thing technologies get a warmer reception from Jacobs: "I think the future will be social networking." He added that services which allow mobile users to find individuals in their buddy group or social network who are physically nearby, using GPS, for example, will be big.
Jacobs also predicts a greater blurring of the line between consumer devices and phones as manufacturers obliterate wires in favour of docking devices with Wi-Fi or cellular connections — not necessarily a smooth transition.
He said: "There's the question of how to wirelessly enable consumer electronics. You don't just slap a modem on it."
Qualcomm seeks to ban some Nokia phones from U.S.
By Dan Nystedt, IDG News Service, 07/10/06
http://www.networkworld.com/news/2006/071106-qualcomm-seeks-to-ban-some.html
Qualcomm gained an ally in its long running patent battle with Nokia, as the U.S. International Trade Commission began investigating the Finnish company for alleged unfair trade practices in importing and selling products that infringe on Qualcomm patents.
Qualcomm has requested that the regulator ban the sale or import of Nokia handsets, components, and other wireless products that allegedly infringe on six Qualcomm patents, the company said Monday in a statement.
Qualcomm, the leading developer of CDMA wireless technologies, has also requested that the ITC bar Nokia from marketing, advertising, demonstrating, warehousing, using or selling in the U.S. any product that infringes on its patents.
The patents in question are all related to GSM, GPRS and EDGE (Global System for Mobile/General Packet Radio Service/Enhanced Data Rates for GSM Evolution) technologies, Qualcomm said.
Thomas Jönsson, director of communications for Nokia in China, declined to immediately comment.
The announcement raises the stakes in a wide-ranging legal battle between Nokia and Qualcomm that erupted over terms of their licensing agreements. Late last year, Qualcomm raised the patent issue with a number of mobile phone vendors, riling existing and potential customers. The company is already suing Nokia in U.S. and U.K. courts, and Qualcomm suffered a blow late last year when six companies filed complaints to the European Commission charging it with anticompetitive behavior.
Qualcomm's CDMA technology is different from technologies based on GSM, which is a European standard, but Qualcomm claims many GSM-based technologies have been developed to the point where they now infringe on its patents. The company has for years licensed its technology to companies such as Nokia in return for fees and permission to use their technology. But the system broke down when a number of companies balked at paying fees they say are too high.
Qualcomm insists its licensing terms are fair, it said in the statement.
The company expects an initial determination from the ITC in the first half of 2007.
Nokia and Qualcomm Battle It Out For 3G Dominance (NOK, QCOM)
Posted on Jul 11th with stocks: NOK, QCOM
http://wireless.seekingalpha.com/article/13338
submits: Picture this scenario if you will. Two bitter rivals going “eyeball to eyeball” in a battle of nerves designed to wear the other down; fingers ready on their respective triggers and seemingly oblivious to the mutually assured destruction that would result if they actually acted on their implied threats.
If thoughts of the ongoing nuclear stand-off with Iran or North Korea come to mind, then it proves that you’ve been reading the front pages of late, but you haven’t necessarily been reading the business pages.
The two rivals in this “cold war” standoff are not card carrying members of the “axis-of-evil”, bent on challenging the might of the United States, but two of the biggest players in the global communications industry - Nokia (NOK) and Qualcomm (QCOM).
The paradox in all this is that both parties have been long time partners, critically dependent on each other.
So what then is the basis for the current acrimony?
As the holder of key patent rights to the third generation (3G) cell phone standard, known as CDMA 2000, Qualcomm has reaped the benefit of its near-monopoly position with this technology by raking in the royalty payments from cell-phone handset and chip manufacturers deploying it’s version of 3G. It’s estimated that somewhere between 4-5% of the price of each CDMA enabled handset goes as a royalty payment to Qualcomm.
Licensees of CDMA 2000 technology have long chafed at paying what they regard as excessive royalties to Qualcomm and rival chipset manufacturers have cried foul at perceived anti-competitive practices on the company’s part. All of this has prompted a wave of litigation that patent lawyers only dream of.
Last year, Qualcomm’s longstanding legal skirmishing with Broadcomm began to widen into an industry-wide conflict. In October 2005, six companies — Texas Instruments (TXN), Broadcomm (BRCM), Ericsson (ERICY), Nokia (NOK), Panasonic Mobile Communications and NEC Corp (NIPNY) — filed a complaint with European telecommunication regulators, claiming that Qualcomm’s licensing arrangements were stifling competition.
In May of this year, Qualcomm fired its own shot, by suing Nokia in British courts over alleged patent infringement related to GSM technology.
All this acrimony is happening against a backdrop of growing acceptance of GSM technology and its version of 3G, called WCDMA, from around the globe. From a 55% global market share in 2000, GSM/WCDMA reached 82% in the first quarter of 2006, as penetration has been facilitated by the availability of cheaper GSM handsets - the key to penetrating low-end markets in China and India.
Global market share could swing back towards CDMA 2000 though, as Qualcomm’s System on Chip (SoC) solution for CDMA 2000 is waiting in the wings and offers the prospect of dramatically lowering handset costs for its licensees.
As the world’s leading manufacturer of cell-phone handsets (33% market share), Nokia has a clear stake in the outcome of this battle and isn’t sitting on the sidelines. Nokia’s CDMA 2000 license with Qualcomm covers only a partial set of patents and is due to run out by April 2007. The current license doesn’t cover access to the new SoC technology.
Late last month, Nokia signaled its intention to scale back its commitment to CDMA 2000 when it canned a proposed joint venture with Sanyo to make CDMA 2000 handsets. The move can be seen as a step towards a full disengagement from CDMA 2000 in anticipation of a non-renewal of its license deal with Qualcomm next year.
As an alternative to CDMA 2000, Nokia could push ahead with its adoption of the WCDMA standard. As the next generation version compliant with GSM, adopting WCDMA is a logical move for Nokia, given its existing base of business in the GSM world. However, the move would not be without risks.
Qualcomm has raised the point that elements of the WCDMA standard are covered under certain patents it holds and you can bet that it would be prepared to take the issue to court. The last thing Nokia would want is to be locked into an endless legal wrangle with Qualcomm over WCDMA, while the emerging market opportunities tied to the emergence of this standard get siphoned-off, due to CDMA 2000 with SoC gaining traction.
Already, CDMA has been gaining in China, with volumes up 55% last year, prompted by a 30% decline in handset prices.
Losing its piece of the next generation (3G) market that should naturally flow from its major commitment to the GSM standard would be a disaster for Nokia. For its part, the last thing Qualcomm wants is to see is its steady stream of royalty income from CDMA 2000 undercut by the unchallenged emergence of an alternative standard like WCDMA.
Given what’s at stake for both parties, the build-up to next year’s April’s license deadline is bound to affect the share price of both companies. Despite Qualcomm shares dropping nearly 21% since the beginning of the year (vs a 7% gain for Nokia), my personal preference would be to continue to favor Nokia at this point.
Nokia has managed to hold its own in response to the intense competition that it now faces in the handset market via product innovation and savvy marketing, while Qualcomm’s competitive response has been primarily confined to the courtroom - a strategy that may have fully run its course.
By Eugene Bukoveczky, Contributor -
Eugene Bukoveczky is a freelance writer for Investopedia.com. He holds a Chartered Financial Analyst (CFA) designation and has broad experience in investment research and portfolio management. He has traveled extensively during his career, working in Toronto, New York, London and Dubai. He graduated from York University School of Business with an MBA.
At the time of release Eugene Bukoveczky owned no shares in any of the companies mentioned in this article.
WiMax prospects pick up
IEEE's decision to suspend progress of the 802.20 broadband wireless protocol could give a lift to WiMax
Martin Veitch, IT Week, 26 Jun 2006
Print : Discuss : Send to friend
http://www.computing.co.uk/itweek/news/2159127/wimax-prospects-pick
The decision of the , the 802.16 technology that is widely seen as its competitor.
The IEEE recently said it would pause the 802.20 working group that has the backing of Qualcomm, the US cellular communications giant that acquired 802.20 developer Flarion Technologies in January. This followed questions of whether participants had disclosed their affiliations in a proper manner.
The decision could aid WiMax, which Intel plans to use in future laptop chipsets to support speeds and distances beyond Wi-Fi.
Carlton O’Neal, vice-president of marketing at WiMax vendor Alvarion, argued that 802.20 is “a private Qualcomm/Flarion party, which they didn’t want to invite anybody else to”. He added, “I don’t think there’s a conspiracy to knock Qualcomm out of the market.”
Graham Currier of Pipex Wireless, which is building a UK WiMax network, said, “I think this is just housekeeping. WiMax is the standard for wireless broadband.”
Qualcomm mobile royalty row hots up
Royalty payments will stop, Korean minister says
Simon Burns in Taipei, vnunet.com 26 Jun 2006
http://www.whatpc.co.uk/vnunet/news/2159118/minister-joins-qualcomm-battle
Leading mobile phone makers Samsung and LG can soon stop paying some royalties to US chip developer Qualcomm, Korea's communications minister told a local newspaper today. However, Qualcomm has denied similar claims twice before.
"As far as we know, the royalty deals between Qualcomm and our main mobile phone producers come to an end this August for CDMA cellphones shipped to the local market," Korea's Information and Communication Minister, Rho Jun-hyong, told the Korea Times.
Earlier this month, Qualcomm categorically denied similar claims in a statement to vnunet.com.
Reports that Korean mobile phone makers' royalty payments to Qualcomm will cease in August 2006 for domestic sales, and in 2008 for international sales, are not correct, according to Christine Trimble, Qualcomm's senior director of corporate communications.
"The royalty obligations that Korean manufacturers have with Qualcomm will continue beyond such dates (for both domestic Korean sales and exports), and there is no date on which a licence under all of Qualcomm's patents becomes royalty free," she said.
Contrary to the Korea Times report, vnunet.com has learned that the royalties Qualcomm collects in Korea could actually increase significantly in August because the company will no longer need to pay 20 per cent of them to a government research institute.
Qualcomm has not confirmed this, but earlier financial filings and statements suggest that the company could generate as much as an additional $300m this fiscal year from the end of royalty-sharing agreements.
Today's article in the Korea Times is the latest in a series of at least four similar stories over the past seven months. Each of the reports has claimed that the Qualcomm royalties will end.
As evidence, the stories cite information from a confidential licence agreement between Qualcomm and Samsung, and statements from a variety of increasingly senior Korean telecoms officials.
The article published today gives no indication that the newspaper or the minister are aware of Qualcomm's earlier denials, despite the widespread attention that they have received.
Trimble told vnunet.com earlier this month that the contract which the newspaper claims to have seen is out of date and has since been "amended and extended".
She said that earlier supporting statements from a government official were apparently the result of confusion. Qualcomm has not yet commented on the communications minister's statement to the newspaper today.
The issue is significant because the size of the claimed royalties is likely to have a noticeable impact on mobile phone prices, and on the financial well-being of Qualcomm and the manufacturers.
Today's report puts the royalty at more than five per cent of the selling price of the mobile handsets. In fiscal 2005 about $2.1bn, or 37 per cent, of Qualcomm's $5.6bn revenue was earned in South Korea, according to the company's financial filings.
Biz, Good morning! Nice to see you in a good mood today. Hope you enjoy reading some good news this morning.
CDMA2000 Offers the Largest Selection of Entry-Level Phones in India From 10 Suppliers
CDMA2000 and GSM Handsets are Approaching Price Parity in India
http://www.primezone.com/newsroom/news.html?d=101246
COSTA MESA, Calif., June 26, 2006 (PRIMEZONE) -- The CDMA Development Group (CDG) (www.cdg.org) announced today that there are 21 CDMA2000(r) phones being offered for less than $50 USD (wholesale) from 10 different suppliers in India. This compares to only 18 GSM handsets being offered for less than $50 from 5 suppliers. The low-cost CDMA2000 handsets provide access to downloadable value-added services, while the GSM low-cost handsets, as 2G devices, do not.
The level of competition to deliver entry-level handsets in India, one of the most competitive markets in world, has increased significantly. A recent Yankee Group report that focused on the monthly ex-factory/landed cost of all handsets legally imported into India has uncovered many important facts related to the price and availability of ultra-low cost devices. The report, entitled "Aiming Low for Great Heights: Ultra-Low Cost Device Competition in India," supports the claim that CDMA2000 devices outperform GSM devices in this dynamic market.
Since the beginning of 2006, CDMA2000 handsets have accounted for as much as 60 percent of all entry-level (sub-$50) handsets imported into India on a monthly basis. And, for more than six months, the difference in the average wholesale price of CDMA2000 and GSM phones being sold below $50 in India has been $1.00 to $4.00 USD. During the same period of time, less than 5 percent of the handsets purchased in India were supplied by the GSM emerging-market handset initiative. The findings of this market study show that CDMA2000 is leading the way in offering subscribers more value and doing a better job at fulfilling the demand for entry-level handsets to price-sensitive consumers in India.
The response of the Indian market towards the purchase of CDMA2000 handsets has been very positive. Today, about one-third of the more than 100 million wireless subscribers in India use a CDMA2000 handset. In March of 2006, CDMA2000 handset shipments into India surpassed those of GSM for the first time. One reason for this increase in shipment volume is due to the larger selection of affordable devices from more suppliers across the entire CDMA2000 product portfolio, and their ability to meet the diverse needs of most Indian consumers. According to the Yankee Group, when considering the entire portfolio of low and high-end devices that were available in India during April of 2006, the average wholesale price of all CDMA2000 devices was $35 less than GSM.
As a result of this intense competition, the price gap between entry-level CDMA2000 and GSM handsets shipped into India has narrowed significantly. Market data now shows that CDMA2000 and GSM handsets are equally competitive at the low end. "CDMA2000 low-cost handsets have approached price parity with GSM and are more affordable than GSM handsets across the entire product portfolio," said Perry LaForge, executive director of the CDG. "These competitively priced devices will enable operators to more effectively address the entire market."
Recent market studies have confirmed that consumers want to do more with their handsets than just make simple voice calls and send short messages. John Jackson, director of wireless/mobile technologies at the Yankee Group, who led the Yankee Group ultra-low cost handset study states, "It is clear that consumers want affordable phones that offer value, not necessarily the cheapest phone. Consumers associate value with brand affinity, quality perceptions, and performance expectations. In this regard, the low end is no different from the high end. Therefore, the lowest priced handsets may actually drive consumers away. In markets such as India where PC penetration is nominal, the data-capable handset will define the Internet experience for a massive numbers of end users."
"Affordable data access using solutions such as BREW(r) are catalyzing value-added service consumption by allowing users to download ringtones, wallpaper, games, news, daily prayers, and eventually Bollywood video clips. In the long term, exposing users to an enriched customer experience and exposure to advanced data services will enable operators to sustain revenue and profit growth," added Jackson.
CDMA2000 offers a larger selection of fixed and mobile devices to address the diverse needs of individual markets and different market segments than any other advanced wireless technology today. Based on current market data, CDMA2000 is leading the way towards addressing the rural market segment in the most price-competitive mobile communications market in the world -- India.
The CDMA industry is working on several initiatives to further reduce the cost and accelerate availability of entry-level devices, as well EV-DO mobile broadband and WorldModeTM global roaming devices. CDMA2000 is becoming the 3G technology of choice for rural markets.
More information on CDMA2000 handsets is available at www.cdg.org. A copy of the Yankee Group report on ultra-low cost devices is available at www.yankeegroup.com.
About CDMA2000
CDMA2000 is the most widely deployed 3G technology in the world, with 152 CDMA2000 operators in 68 countries, including 37 CDMA2000 1xEV-DO systems in commercial operation. With more than 250 million subscribers, CDMA2000 controls 82 percent of the 3G market. CDMA2000 has become the technology of choice for cdmaOne(tm), TDMA, analog and Greenfield operators, and is deployed in the 450, 800, 1700, 1900 and 2100 MHz bands. Nearly 1,200 CDMA2000 devices are available on the market, including 280 EV-DO devices. More information on CDMA2000 is available on the CDG Web site at www.cdg.org.
About CDG
The CDMA Development Group is a trade association formed to foster the worldwide development, implementation and use of CDMA technologies. The more than 100 member companies of the CDG include many of the world's largest wireless carriers and equipment manufacturers. The primary activities of the CDG include development of CDMA features and services, public relations, education and seminars, regulatory affairs and international support. Currently, there are more than 500 individuals working within various CDG subcommittees on CDMA-related matters. For more information about the CDG, contact the CDG News Bureau at +1-714-540-1030, or visit the CDG Web site at www.cdg.org.
CDMA2000 is a registered trademark of the Telecommunications Industry Association (TIA-USA).
cdmaOne is a trademark of the CDG.
BREW is a registered trademark of QUALCOMM Incorporated.
CONTACT: CDG News Bureau
Ricca Silverio
(714) 540-1030
Fax: (714) 540-1060
rsilverio@bockpr.com
--------------------------------------------------------------------------------
Keywords: TELECOMMUNICATIONS
Huawei to See Sharp Sales Rise in Asia
June 26, 2006]
http://www.tmcnet.com/usubmit/2006/06/26/1695061.htm
(Comtex Business Via Thomson Dialog NewsEdge) SHENZHEN, Jun 26, 2006 (SinoCast China IT Watch via COMTEX) --Huawei Technologies, the biggest telecom equipment maker in China, announced on June 21 that it expects contract sales for the southern Asia-Pacific region to grow 55 percent to USD 2 billion this year.
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"Asia-Pacific is one of the fastest-growing regions in the world for us," Liu Jiang Feng, Huawei's vice president for Asia- Pacific, said in a statement. "We currently work with over 150 Asian telecom operators."
Huawei's contract sales in the southern Asia-Pacific region, which includes India, southeast Asia, Australia and New Zealand -- reached USD 1.29 billion in 2005.
Huawei competes with local rival ZTE Corp in the Chinese market, alongside the likes of global giants like Motorola, Ericsson and Nokia, bidding for the billions of dollars China spends each year on telecoms equipment as it upgrades its networks.
Both Huawei and ZTE have embarked on aggressive campaigns to expand beyond their home market in the last three years, offering telecoms equipment at prices below those of their global counterparts.
Both companies scored most of their initial success in developing markets such as India, southeast Asia and Africa, but have had more difficulty moving into more the lucrative and bigger-spending markets in Western Europe and North America.
Privately-held Huawei was the first to break that pattern, scoring a string of big deals dating back over the last year and a half.
The company's first big breakthrough came in late 2004 when it was selected to build the third-generation (3G) mobile network for Dutch carrier Telfort, in a deal sources valued at ERU 200-400 million euros.
Since then, the company has also signed deals to be a preferred telecoms equipment supplier to Britain's BT Group Plc and, earlier this month, to supply mobile phones to Vodafone, the world's largest mobile carrier by revenue.
As a private company, Huawei only reports limited results and does not generally discuss its profits, though the company says it is profitable.
During the first half year of 2005, Chinese Internet equipment maker Huawei Technology made total sales of CNY 33 billion, an increase of 85 percent from the comparable period one year ago.
Of the total revenue, overseas sales were USD 2.47 billion, accounting for as much as 62 percent, outpacing the sum of 2004. The company made partnership with 19 foreign telecom carriers including British Telecom in the first six months this year.
Huawei's CDMA sector saw an increase of 200 percent in the international markets, compared with 120 percent growth of the company's mobile communications terminal department.
As for the 3G standard WCDMA, Huawei had gained 5 percent of basic patents of the standard, vaulting into the top five patent bearers globally. By the end of June 2005, Huwei's WCDMA sector received total 11 contracts from foreign telecom carriers.
With its latest WCDMA base stations, which were launched by Huawei Technologies in February this year, the company has got big head start on its rivals.
In the GSM sector, Huawei has come up with 3G solutions that support 3G networks and corporate trunk communications. For the first half year alone, Huawei installed 20-million-line GSM switches for 26 telecom carriers in 20 countries. On top of that, its GT800 trunk communications system has passed through the final tests of the Ministry of Information Industry.
From Shanghai Morning Post, Page 1, Friday, June 23, 2006
info@SinoCast.com
CDG Comments on the Dissolution of the Planned Nokia and Sanyo Joint Venture
CDMA2000 Will Continue to Serve the Global Demand for Affordable Communications Well Into the Future
http://www.primezone.com/newsroom/news.html?d=101244
COSTA MESA, Calif., June 26, 2006 (PRIMEZONE) -- In response to the recent dissolution of the planned Nokia and Sanyo joint venture and subsequent statements by Nokia, the CDMA Development Group (CDG) (www.cdg.org) offered today the following comments.
1. The CDG is disappointed that the proposed joint venture between
Nokia and Sanyo did not come to fruition. It was anticipated that
for Nokia, this would have meant a stronger position in key CDMA
markets such as the United States, Japan and Korea where CDMA
growth is exceptional, and would have facilitated Nokia's
participation in emerging CDMA markets such as Africa, Brazil,
China, India and Russia.
2. The CDMA2000(r) industry is well supported with a large and
highly competitive handset supplier base. Currently, there are
over 50 different vendors who have produced over 1250 devices for
CDMA2000. In this highly competitive market, consolidation is
expected.
3. According to Strategy Analytics, LG, Samsung and Motorola are the
leading suppliers of CDMA handsets worldwide. Nokia's CDMA global
market handset share has remained small, particularly in key
markets such as North America. Should Nokia reduce their
shipments of CDMA handsets, we anticipate that several of the
other CDMA handset suppliers will easily fill this void.
4. This healthy competition has resulted in the availability of
entry-level 3G CDMA2000 handsets that have approached price parity
with 2G GSM handsets. As an example, there are 21 CDMA2000 phones
currently offered for less than $50 USD (wholesale) from 10
different suppliers in India, which is one of the most competitive
mobile communications markets in the world. Two of these device
models come from Nokia; the remaining 19 phones are supplied by
LG, Motorola, Samsung, Huawei, Haier, JingPing, Kyocera, UT
Starcom and ZTE. These entry-level CDMA phones enable access to
downloadable value-added services, while the competing 2G phones
that support the GSM standard do not.
5. CDMA2000 continues to enjoy strong industry-wide support as
evidenced by recent quotes in CDG press announcements from KDDI,
LG Telecom, Sprint-Nextel, Telecom New Zealand, Verizon Wireless,
Airvana, Qualcomm, Lucent, Motorola and Nortel. CDMA2000 provides
operators with a significant competitive advantage. Today, there
are more than 152 operators in 68 countries delivering 3G services
to more than 250 million people worldwide.
6. Many of the CDMA2000 networks launched over the last several years
have been in price-sensitive and underserved rural markets such as
Africa, Russia and greater Asia. These operators have selected
CDMA2000 to deliver affordable voice and broadband Internet access
using low frequency assignments (e.g., 450 and 800 MHz). Economic
studies have shown that in many markets the total cost of
ownership of a 3G CDMA2000 network is less than a 2G network.
Today, there are more than 50 CDMA450TM operators worldwide
serving some of the most remote places on earth. CDMA2000 is
expected to remain the leading 3G technology serving rural
markets worldwide for the foreseeable future.
The CDG is available for more comments. More information on CDMA2000 is available at www.cdg.org.
About CDMA2000
CDMA2000 is the most widely deployed 3G technology in the world, with 152 CDMA2000 operators in 68 countries, including 37 CDMA2000 1xEV-DO systems in commercial operation. With more than 250 million subscribers, CDMA2000 controls 82 percent of the 3G market. CDMA2000 has become the technology of choice for cdmaOne(tm), TDMA, analog and Greenfield operators, and is deployed in the 450, 800, 1700, 1900 and 2100 MHz bands. Nearly 1,200 CDMA2000 devices are available on the market, including 280 1xEV-DO devices. More information on CDMA2000 is available on the CDG Web site at www.cdg.org.
About CDG
The CDMA Development Group is a trade association formed to foster the worldwide development, implementation and use of CDMA technologies. The more than 100 member companies of the CDG include many of the world's largest wireless carriers and equipment manufacturers. The primary activities of the CDG include development of CDMA features and services, public relations, education and seminars, regulatory affairs and international support. Currently, there are more than 500 individuals working within various CDG subcommittees on CDMA-related matters. For more information about the CDG, contact the CDG News Bureau at +1-714-540-1030, or visit the CDG Web site at www.cdg.org.
CDMA2000 is a registered trademark of the Telecommunications Industry Association (TIA-USA).
CDMA450 is a registered trademark of the Telecommunications Industry Association (TIA-USA)
cdmaOne is a trademark of the CDG.
WorldMode is a trademark of the CDG
CONTACT: CDG News Bureau
Ricca Silverio
(714) 540-1030
Fax: (714) 540-1060
rsilverio@bockpr.com
--------------------------------------------------------------------------------
Keywords: JOINT VENTURE, TELECOMMUNICATIONS
Taiwan makers may benefit from scrapping of Nokia and Sanyo CDMA JV
Daniel Shen, Taipei; Adam Hwang, DigiTimes.com [Monday 26 June 2006]
http://www.digitimes.com/telecom/a20060626A7039.html
Nokia and Japan-based Sanyo Electric on June 22 announced the cancellation of a plan proposed in mid-February to set up a joint venture to produce CDMA handsets. Nokia, in response to the change, has decided to reduce its CDMA investment, and this may bring more Nokia OEM/ODM orders to Taiwan-based makers of CDMA handsets, according to local industry sources.
Foxconn International Holdings (FIH), an existing Nokia supplier, has obtained orders for CDMA handsets from Nokia, the sources pointed out. VIA Technologies, a leading Taiwan-based chipset design house, has acquired CDMA solutions from LSI Logic and plans to team up with Darts, a handset design company in Taiwan, to compete for orders from Nokia, the sources indicated.
However, Taiwanese companies are faced with competition from China, the source noted. Nasdaq-listed handset solution provider China TechFaith Wireless Communication Technology, for example, has landed orders from Nokia through support from Qualcomm, the owner of most CDMA patents, the sources added.
CDMA2000 Manufacturers Comment on the Strength of the 3G CDMA2000 Evolution Path
CDMA2000 Evolution Path Provides Significant Boost in the Introduction of All-IP, Next-Generation Multimedia Technologies
http://www.primezone.com/newsroom/news.html?d=101245
COSTA MESA, Calif., June 26, 2006 (PRIMEZONE) -- Manufacturers commented today on the strength of the CDMA2000(r) 3G evolution path, the CDMA Development Group (CDG) (www.cdg.org) reports. Specifically, manufacturers emphasized that 1xEV-DO's migration to Revisions A through C ensures the technology's ability to deliver vital advanced broadband services. Many of the world's top-tier operators, including KDDI, LG Telecom, Sprint Nextel, Verizon Wireless and Telecom New Zealand have committed to, or are already in the process of, deploying the all-IP technology.
"The deployment of Revision A is a major milestone in the delivery of next-generation wireless broadband, and is an important step towards converged voice and data services," said Perry LaForge, executive director of the CDG. "Through an easy upgrade of existing networks, CDMA2000 vendors will enable operators to retain their first-to-market status with these capabilities."
CDMA2000 vendors commented:
-- AIRVANA: "CDMA2000 will deliver next-generation broadband
services long before the competition," said Paul Callahan, vice
president of business development for Airvana. "EV-DO, Rev. A
will bring high-quality mobile VoIP to consumers and businesses
years ahead of UMTS."
-- QUALCOMM: "CDMA2000 has already greatly changed the lifestyles
of millions of people around the globe by offering a broad
range of services," said Jeffrey K. Belk, senior vice president
of marketing for QUALCOMM. "The next evolution of EV-DO will
take mobile broadband to the next level, enabling access to
highly compelling, fully integrated voice and data services."
-- LUCENT TECHNOLOGIES: "The CDMA2000 roadmap cost-effectively and
efficiently enables operators to deliver new, next-generation
services that blend voice, data, video and multimedia
capabilities," said Tom Goodwin, regional CTO, Lucent
Technologies Asia Pacific. "It also will help CDMA2000 operators
remain at the cutting edge of wireless communications for years
to come."
-- MOTOROLA: "In terms of services and applications, CDMA2000's
migration path offers a very compelling package to subscribers,"
said Bruce Stone, senior vice president, Motorola. "The advanced
capabilities of Revision A will deliver a new generation of
wireless data services faster and more efficiently than ever
before, providing users more choices and an enhanced wireless
experience."
-- NORTEL: "CDMA2000 and its evolution enables critical, real-time
applications that benefit end-users while improving spectral
efficiency, driving a competitive advantage for operators," said
Doug Wolff, vice president and general manager, CDMA, Nortel.
"Because the CDMA2000 solution can be easily evolved from the
existing infrastructure, it provides significant investment
protection for operators as they roll out mobile broadband
services."
1xEV-DO has been commercially available since January 2002 and is leading the way for all mobile broadband technologies globally. Today, there are 37 commercial 1xEV-DO networks in 24 countries and 40 more are being deployed. In Q1 2006, 1xEV-DO added six million users to reach a total of 30 million subscribers. In addition, there are 280 1xEV-DO-ready devices on the market. CDMA2000 1xEV-DO Revision A is an enhanced version of 1xEV-DO Release 0. Revision A is optimized for packet data service, and supports peak data rates of 3.1 Mbps on the forward link and up to 1.8 Mbps on the reverse link. Revision A also reduces system latencies to support delay-sensitive applications.
More information on CDMA2000, Rev A and the evolution path is available at www.cdg.org.
About CDMA2000
CDMA2000 is the most widely deployed 3G technology in the world, with 152 CDMA2000 operators in 68 countries, and 37 CDMA2000 1xEV-DO systems in commercial operation. With more than 250 million subscribers CDMA2000 controls 82 percent of the 3G market. CDMA2000 has become the technology of choice for cdmaOne(tm), TDMA, analog and Greenfield operators, and is deployed in the 450, 800, 1700, 1900 and 2100 MHz bands. Nearly 1,200 CDMA2000 devices are available on the market, including 244 1xEV-DO devices. More information on CDMA2000 is available on the CDG Web site at www.cdg.org.
About CDG
The CDMA Development Group is a trade association formed to foster the worldwide development, implementation and use of CDMA technologies. The more than 110 member companies of the CDG include many of the world's largest wireless carriers and equipment manufacturers. The primary activities of the CDG include development of CDMA features and services, public relations, education and seminars, regulatory affairs and international support. Currently, there are more than 500 individuals working within various CDG subcommittees on CDMA-related matters. For more information about the CDG, contact the CDG News Bureau at +1-714-540-1030, or visit the CDG Web site at www.cdg.org.
cdmaOne is a trademark of the CDG.
CDMA2000 is a registered trademark of the Telecommunications Industry Association (TIA-USA).
CONTACT: CDG News Bureau
Ricca Silverio
(714) 540-1030
Fax: (714) 540-1060
rsilverio@bockpr.com
--------------------------------------------------------------------------------
Keywords: TELECOMMUNICATIONS
The Threat to Europe
Tuesday June 6, 9:38 am ET
By Jorma Ollila
http://biz.yahoo.com/bizwk/060606/gb20060605905142.html?.v=1
We often fail to recognize the benefits brought about by free trade and an open economy. This is particularly so in Europe, where the largely harmonized internal market is very much taken for granted.
When I became chief executive officer of Nokia (NYSE:NOK - News) in 1992, the regulatory burden in Europe was much heavier than it is today. Europe was consumed with heavy taxes and duties, but we have come a long way since then. That progress has recently been threatened, however, by a rise in economic nationalism. This concerns me, as today more than ever, European nations need to work together to secure the levels of innovation and productivity companies need in global competition.
Recent examples of European economic nationalism abound, most often in the area of cross-border mergers and acquisitions. But it doesn't stop there. European countries face increased thresholds of difficulty in implementing commonly agreed legislation, and too easily drift apart on essential issues such as international trade. Sadly, many public figures think more of short-term political success than the longer-term necessity of unpopular decisions.
Finding A Balance.
Although a European Union directive on cross-border takeovers exists, its limited scope serves as an example of just how restricted the EU is in remedying economic nationalism. First, the directive has been so watered down that it may have little effect on easing cross-border takeovers. Second, the ultimate implementation of the directive lies in the hands of the EU's member states.
As a CEO, I understood the need to protect a company's interests at all costs, finding a balance between its owners and other stakeholders. All the same, I also believe that in a position of leadership, it is important to make decisions that will bring long-term benefits, even if these decisions are difficult or unpopular.
Likewise, if governments blur their long-term responsibilities to the electorate by making short-term, populist policy decisions -- instead of focusing on economic policies that allow companies to formulate globally competitive business strategies --the results can be disastrous in the long term. One company with potential for global leadership is far more valuable for its European stakeholders than a handful of suffering national champions. In today's world, a purely nationalistic view on business is simply outdated.
Too Much To Lose?
Governments and the EU have to make tough decisions regarding mergers, takeovers, and labor laws in order to create and secure the best regulatory environment for spurring industrial innovation and research and development. Policy measures that deal with the critical issues facing Europe must be effectively implemented.
European countries also need to secure support from their citizens for EU initiatives that are aimed at meeting Europe's challenges. It's a pity that so many Europeans feel they have too much to lose, as it makes reform difficult. This is why more emphasis should be put on the benefits that a fully functioning single market brings to the majority of people, rather than on the adjustment costs it imposes on a minority.
Imposing populist sentiment against EU initiatives does not help Europe. Instead, political leaders should positively influence integrationist trends and work towards rallying support from their citizens for measures to strengthen the single market. National governments have to adhere to and maintain the original principles of the truly single market. Of course, broad agreement on unpopular measures in an expanded Europe of 450 million people of different backgrounds presents difficulties.
However, these difficulties are not insurmountable and must be overcome, as there is no better way to secure the future prosperity and competitiveness of Europe than to build a strongly integrated economic area. It is after all, the basis of existence for today's Europe as we know it.
New Nokia CEO Forced to Eat His Words
May 25, 2006
TMCnet News
http://ipcommunications.tmcnet.com/hot-topics/wireless/articles/1318-new-nokia-ceo-forced-eat-his-wo....
By Kumar Amitav Chaliha
TMCnet Contributing Writer
New Nokia CEO Olli-Pekka Kallasvu didn’t even have time to eat his words. Even as he announced that he intends to make the Finnish phone maker the most admired and respected company in the world, news came in of wireless technology supplier Qualcomm Inc. suing Nokia (News - Alert) over patent infringements in the UK.
Qualcomm (News - Alert) yesterday filed a suit against Nokia for allegedly infringing on two of its patents in the UK. The patents are for mobile devices that are capable of operating in accordance with the GPRS and/or EDGE standards (but don’t have CDMA capability).
The proceedings of the suit seek an injunction against Nokia. Qualcomm has also asked for damages for phones already sold in the market using the technology, according to a press release.
Earlier this week, Kallasvu announced with great fanfare his intention of making Nokia the best company in the world.
“The right ambition ... is to make Nokia the most loved and admired brand in the world, all industries included,” Olli-Pekka Kallasvuo said at an investor meeting in the United States earlier in the week, according to Reuters. “That is very much what I am pushing for.”
The suit Qualcomm filed is an extension of the patent infringement litigation filed by the company against Nokia in the U.S. last November.
The two companies have a history of fighting over technology licensing and patent issues.
In published reports, Kallasvuo has said the ongoing disputes with Qualcomm will not be solved overnight, yet he is committed to making peace.
“I think we really need to be focused on making this happen,” Reuters quoted him as saying “It is very clear that IPR discussion in our industry, in any industry, takes quite a while.”
Qualcomm is a San Diego, Calif.-based wireless technology supplier. The company is a leader in developing and delivering innovative digital wireless communications products and services based on CDMA and other advanced technologies.
Nokia is the world’s largest mobile phone manufacturer.
-------
Kumar Amitav Chaliha is a contributing writer to TMCnet.
Analyst claims Nokia getting the better of Qualcomm in IPR squabble
By Phil Carson
May 23, 2006
http://rcrnews.com/news.cms?newsId=26430
NEW YORK—Investment bank UBS joined the latest wireless parlor game: Will Nokia Corp. or Qualcomm Inc. get the upper hand in the two companies’ intellectual property rights licensing negotiations?
UBS analyst Maynard Um wrote in a report on Nokia that the Finnish handset behemoth’s IPR position within the industry is “strong and getting stronger” due to significant IPR in GSM and W-CDMA. Further, Um wrote, Nokia’s position vis-à-vis Qualcomm “appears to have improved materially” from the time the current agreement with the chip maker was first signed in 1992 (and extended in 2001). Also, Nokia’s joint venture with Sanyo Corp. to produce CDMA handsets would no longer require Nokia to license IP for CDMA2000.
Those factors should lead Nokia to lower royalty payments to Qualcomm going forward, while receiving higher royalties from other device manufacturers, according to UBS.
A Qualcomm spokesperson declined to comment on the UBS report.
Snip From Bloomberg re Qualcomm
http://www.bloomberg.com/apps/news?pid=10000087&sid=a6RSKrR8qbjs&refer=top_world_news
Qualcomm Inc., the world's No. 2 maker of chips that run mobile phones, gained 25 cents to $47.15 in Germany, rebounding from a three-month low in U.S. trading yesterday. CNBC's Jim Cramer recommended the stock on his ``Mad Money'' show, saying Qualcomm is having solid growth outside the U.S.
Real time quote from Yahoo.com
Symbol Time* Trade* Change* After Hrs Chg* Bid* Ask*
QCOM 8:29AM ET 47.69 +0.79 (1.68%) N/A 47.53 47.70
SPX unit lands wireless TV contract
Thursday May 11, 9:39 am ET
bizjournals.com
http://biz.yahoo.com/bizj/060511/1286929.html?.v=1
SPX Corp. says a Qualcomm Inc. subsidiary will use antennas, filters, transmission lines and cables manufactured by SPX's Dielectric Communications division.
MediaFlo USA is integrating the products into the transmitting sites of its nationwide mobile wireless TV network.
"This market opportunity allows us to leverage our proven radio-frequency technology and expertise into the mobile media market," says David Wilson, president of SPX's dielectric business. "Our new MobileMedia antenna line offers antennas specifically designed for applications in this transmission spectrum and presents a targeted solution for Qualcomm's needs."
Financial terms of the agreement weren't disclosed.
Based in Maine, Dielectric Communications makes broadcast antenna systems for radio and television, lighting and monitoring equipment.
Qualcomm (NASDAQ:QCOM - News), based in San Diego, designs, produces and markets digital wireless telecommunications products and services.
Charlotte-based SPX (NYSE:SPW - News) sells flow technology, testing and measurement equipment, thermal equipment and services, and industrial products and services.
Published May 11, 2006 by the Charlotte Business Journal
Lex live: 3G intellectual property
Thursday May 11, 8:55 am ET
FT.com
http://biz.yahoo.com/ft/060511/fto051120060912547720.html?.v=1
Investors are sceptical about 3G. After years of hype, only a tenth of global mobile subscribers have 3G phones. Still, the spat between Nokia and Qualcomm (NASDAQ:QCOM) over intellectual property (IP) suggests 3G has finally come of age.
Qualcomm pioneered CDMA technology, but missed out on the 2G boom which was largely based on the rival GSM standard. In 3G, however, its position is outstanding, with critical patents owned for both standards (CDMA2000 and WCDMA), which it licenses to handset and component manufacturers. Licence revenues should reach $2.6bn in 2006, of which about half should be from 3G.
Qualcomm's model has attractions. Unlike GSM patent owners, it has no major conflicts of interest with handset makers. For a fee, anyone can get access to the IP it owns or has aggregated. The question is whether that fee, of perhaps 4 per cent of a handset's price, is fair. Qualcomm points out that it has amicable agreements with 130 manufacturers. However, Nokia, Ericsson, NEC and Panasonic all now claim that Qualcomm is overcharging.
They say that Qualcomm's share of WCDMA IP is lower than for CDMA2000, while its royalty rates are the same. Qualcomm disputes this, but offers no alternative analysis. Financial metrics suggest massively excessive returns. Qualcomm's IP division's operating margins are over 90 per cent. It is entitled to an economic return on its high risk investment. However, IP operating profits of about $2.4bn this year compare embarrassingly well to cumulative research and development spend of $4.6bn over the past decade.
Despite the evidence, Qualcomm exhibits the confidence of the ascendant. Rightly so. The absolute impact on end user prices is too small to spark consumer outrage, and regulators could take years to act. By that time even the 3G boom may have come and gone.
Qualcomm Breakup Could Ring in the Bling
http://online.barrons.com/google_login.html?url=http%3A%2F%2Fonline.barrons.com%2Farticle%2FSB114721....
Qualcomm (QCOM: Nasdaq) By Merrill Lynch ($52.66, May 9, 2006)
QUALCOMM'S COMMERCIAL AGREEMENT with Nokia will be up for renewal in April 2007. Should the two not reach an agreement by April 2007, Nokia will not be able to recognize revenues on WCDMA [wideband code-division multiple access] handset shipments (and eventually will not be able to sell phones), and Qualcomm will not be able to recognize revenue on its chip shipments (with the eventual outcome of not being able to sell semiconductors).
[Qualcomm manufactures and markets wireless-telecommunications products. WCDMA is third-generation technology boosting wireless-data-transmission capabilities.]
Qualcomm Provides an Analysts Market Update
http://www.cellular-news.com/story/17316.php
Qualcomm recently held an Analysts Day for investors. Merrill Lynch were there and report that the day, unsurprisingly was focused predominantly on growth expectations of the WCDMA market. Growth of 3G markets (both evolving from CDMA and GSM upgrades) was strong, with 77% YoY subscriber growth in the CDMA EVDO market and 139% YoY subscriber growth in WCDMA over the same time frame.
In the Japanese market, 53% of users are now on WCDMA, and the 3G subscriber base surpassed 2G subscribers for the first time in March 2006.
In contrast, 75% of handset shipments in the Dec-05 quarter in Europe were GSM vs. 25% for WCDMA. However, Merrill Lynch sees a clear migration to WCDMA with an 8% YoY decline in GSM handset shipments vs. a 144% increase in WCDMA handset shipments. This was fueled predominantly by declining handset selling prices, with 10% seq. decline in calendar 3Q05 and an additional 8% seq. decline in calendar 4Q05.
Another driver of the 3G rollout was the drive by carriers to increase their data ARPU. March quarter results show Verizon and Sprint (and others) growing their data ARPU on a YoY basis by 79% and 55% respectively through the customer migration to 3G services.
One interesting fact that emerged was the impact of handset subsidies on sales of high-end phones. It seemed that in South Korea, where handset subsidies have just been reintroduced, the average price paid did not fall - the customer simply spent the same amount as before, but purchased a higher spec model.
Qualcomm's CEO, Dr. Jacobs confirmed that the company will continue to focus on being a wireless/cellular technology enabler, in the current 2G and emerging 3G world, and in future 4G technology. The company will be driving the market towards technology neutral handsets, putting multiple antennas into handsets to support 3G and WiFi services. Doubtless, some operators may have differing opinions about that move however, seeing a potential WiFi attack on their 3G and VoIP revenues.
There was no significant detail into the ongoing royalties dispute with Nokia, it generally being accepted that all the hype is nothing more than negotiating tactics. Both parties have too much to lose from not settling the royalty payments by the April 2007 deadline.
Qualcomm top man defends IPR regime
08 May 2006
Says HSDPA implementations now biased to Qualcomm's interpretations
http://pda.mobileeurope.co.uk/news/news_story.ehtml?o=2144
Dr Sanjay Jha, president of Qualcomm's CDMA Technologies Group, has told Mobile Europe that, in fighting Nokia and others on IPR terms, Qualcomm is only upholding 200 years of patent law by holding out for what is rightfully due to it.
"I can remember when we literally didn't know if this company [Qualcomm] was going to survive another day," he said. "I remember Irwin [Jacobs, founder and ex-ceo] going to the bank and paying us out of his own money. We took a huge risk and completely went out on our own. People said there was no way CDMA could work, and now look.
"So I think we should take the appropriate value for that. Patents were supposed to help innovation," he said, "and it's almost as if they are becoming the anti-innovator. "You need to look for balance, and that balance is in the quality not the quantity of patents."
Jha said that Qualcomm feels its innovation has speeded development in 3G technologies, rather than its license terms acting as a barrier, as several OEMs have made out. UMTS, which works on Wideband CDMA is two years ahead of 2G GSM in terms of rollout and adoption, he said, citing the GSM community's own figures. He also said one operator credits the influence of Qualcomm in making HSDPA market-ready a year earlier than expected.
"HSDPA has been the only technology where the devices have been ready before the networks," he claimed, "And I think we played a great part in that."
Qualcomm chipsets are currently in design with around 45 HSDPA devices, he said, out of an overall W-CDMA total of arouns 125 handsets.
Qualcomm's early involvement in developing HSDPA chipsets - it sampled its first chipset in December 2004, meant that it was able to spend all of 2005 interoperability testing its system solution, Jha said. This has put the company ahead of the game because early interoperability testing means "we get the infrastructure implementation to be biased to our interpretation of the standard. When other companies interoperate with us they know they are interoperable with Nortel and Ericsson as well."
"It puts us as the default interpretation of the standard, and I don't mean that in a bad way but that's just the practicalities."
The advantage to the industry as a whole, Jha said, is that it can develop along fully interoperable and open lines.