Qualcomm Inc (QCOM)

[Eric]

Qualcomm's CEO on Elop's Strategy Decision (from Finland's Helsingin Sanomat) ...

Yo Roxie,

Good to see a little activity on this board and you (and Rich) still active on it. It's going on 9 months since I last posted and over 100 hundred posts since I last lurked (but I just caught up). It has been almost exactly 2 years since I tried to encourage expanded participation here. Time flies. Actually I've been rather inactive on iHub all together, even on the single board I host here.

Several drop outs here including Mindy who was contributing nicely for a time after she and I had a few clashes. but too few new faces considering the way QCOM has been performing. I see Pumpkin's still here and that his personality has not changed, and so on occasion is the head cheerleader on our SI No Cheerleading board that Herr Su founded for those of us with a long QCOM view a decade ago and which Slacker now hosts. It's still a fine board but it collects an awful lot of daily posts to wade through. Not exactly the tight ship Ramsey envisioned. This one's certainly tighter. <ggg>

>> Jacobs says, taking Samsung’s Windows phone out of his pocket ...

"It will bring depth and sprit to the Windows ecosystem, which is very important for application developers. It is also a sign of the fact that even though the company worked hard with MeeGo, a new operating system had to be introduced on the market sooner. I feel that it is important to notice that [Nokia CEO] Stephen Elop has made a decision which will push Nokia forward. In addition, the new operating system will help the company to rationalise its service strategy ... I am looking forward to getting an opportunity to work with him"

Jacobs is one of the few people with whom Elop has discussed the change. Qualcomm is the world’s largest maker of handset chips, which are already in use in various Windows Mobile and Google Android devices. ###



Nicely chosen words, IMO.

As detail about how (and why) Nokia plans to position Symbian, MeeGo, Ovi, and Qt on a short, medium and possibly long term basis through what will be a tough transition I'm beginning to somewhat warm to Elop's 'Ecosystem' and primary OS platform decision (the Nokia Board's decision which he facilitated and publicly presented). Please don't take the preceding statement as an endorsement of the decision, however. My personal jury is out on Elop and the decision, and I have no intention of rushing to judgment on the matter.

I NEVER expected. the decision, however, and was floored when Stephen announced it. I assumed that Nokia would ratify the prior platform strategy based on Qt with Ovi as its cornerstone, promise significantly better execution in delivering it, and announce expanded cooperation with the Microsoft collaboration with Nokia that Elop had previously engineered.

As a LT QCOM shareholder I view this as a significant medium and hopefully long term opportunity for Qualcomm and a chance to cement a relationship that has been building for some time. Nokia will want at least ine 2nd source and ST-Ericsson is no doubt still in the picture but I think Nokia is not real happy with the way the relationship has evolved to date and while I don't rule it out altogether I don't see them doing Win Phone IC business with Media Tek who supposedly will supposedly be producing low cost Win Phone ICs. Then of course there is TI who is still producing the majority of Nokia's integrated (BB and A-Processor) custom ASICs and Renesas which is certainly a wild card. Lots of options but I would think Qualcomm could have the inside track. First units probably not till 2012 and very possibly the 1st Windows Phone 8, not WP7, although Qualcomm has to give HTC high priority for WP8.

>> Nokia’s New Strategy Prompts Suspicions Among Investors And Consumers Alike

At Barcelona’s Mobile World Congress the Partnership between Nokia and Microsoft Sparked Lively Debate

Helsingin Sanomat
International Edition
Helsinki Finland
February 15, 2011

http://9r42.sl.pt

Everybody is talking about it: in restaurants, in the streets, in the corridors of the congress venue, even in the loos.


Visitors to the Barcelona Mobile World Congress stopped in the street to listen to Microsoft CEO Steve Ballmer speaking about his company’s new alliance with Nokia.

The mobile phone giant Nokia’s decision to start utilising Microsoft’s Windows Phone 7 operating system as the primary software platform for its smartphones has been possibly the hottest topic of debate at the Mobile World Congress that started in Barcelona on Monday.

Many professionals working in the mobile phone industry have already expressed astonishment at Nokia’s decision. Even investors seem to have plenty of doubts. On Monday, the Nokia share price continued to fall on the Helsinki Stock Exchange: the share price came down by more than 5%, after shedding 14% of its value on Friday.

The prevailing opinions about Nokia and Microsoft’s alliance are comparatively convergent: Nokia is taking a major risk by outsourcing the operating system of its smartphones. If consumers are not enthusiastic about Nokia’s Windows handsets, the situation at the company could in a couple of years’ time be even more fraught than it is today.

Tim Boddy, an analyst at Goldman Sachs International, estimated in his report on Monday that this is the most significant change at Nokia since the beginning of the 1990s. At that point, the company divested many of its businesses, investing strongly in mobile phones and network equipment.

At the 2010 Mobile World Congress, Nokia and Intel, the world’s largest manufacturer of semiconductors, announced that they would be linking up their programming develop activities. The Moblin software platform, developed by Intel for mobile devices, and Nokia’s corresponding Maemo were to be merged into MeeGo, a new Linux-based software platform.

Now Nokia has decided to give up its open MeeGo software [actually it hasn't], and replace it by a closed operating system.

”When it comes to Nokia products, we will have to ask them, but we are disappointed with their decision. Instead, Intel is committed to MeeGo, like very many other device makers and teleoperators. We are annoyed, but life goes on”, said Renée James, the senior vice president and general manager of the Software and Services Group for Intel Corporation, at a press conference. After the occasion, she refused to comment on the time when Nokia informed them about replacing MeeGo or on the existence of any legal disputes between the two companies relating to contract law.

Nomura analyst Stuart Jeffrey, who is familiar with Nokia, stresses that Nokia had only a bare few options left.

”For four years, Nokia has tried to fix its own Symbian platform without success. The several years of development in the Maemo and MeeGo operating systems did not yield any meaningful results either, and neither did the OVI services”, Jeffrey notes. In Jeffrey’s view, the Nokia CEO could still have waited for MeeGo to develop.

”Maybe he noticed that the company did not have enough know-how to fix these issues, which is why Nokia had to choose a swap out for Microsoft software. However, we can say that when it comes to risk management, the company could have chosen both {or even Google's Android}”, Jeffrey continued.

In Jeffrey’s opinion, it is now clear that Nokia is no software company.

Paul Jacobs, the CEO of the US semiconductor company Qualcomm, regards Nokia’s decision as exciting.

”It will bring depth and sprit to the Windows ecosystem, which is very important for application developers. It is also a sign of the fact that even though the company worked hard with MeeGo, a new operating system had to be introduced on the market sooner”, Jacobs says, taking Samsung’s Windows phone out of his pocket.

Qualcomm is the world’s largest maker of handset chips, which are already in use in various Windows Mobile and Google Android devices.

”I feel that it is important to notice that [Nokia CEO] Stephen Elop has made a decision which will push Nokia forward. In addition, the new operating system will help the company to rationalise its service strategy”, Jacobs contemplates.

Jacobs is one of the few people with whom Elop has discussed the change.

”I am looking forward to getting an opportunity to work with him”, Jacobs adds.

Investors still failed to grasp fully the benefits of the Nokia-Microsoft partnership in Helsinki on Tuesday, as the stock opened at just EUR 6.57 and briefly touched EUR 6.56, its lowest level in the 21st century. Thereafter there was some cautious buying and by 14:00 the share had risen from the depths somewhat, reaching EUR 6.75 at one stage.

The enthusiasm was rather short-lived, however, and at the time of posting this article at 14:27, Nokia was trading only marginally up on the day at EUR 6.63, the self-same price at which it closed on Monday, with a sharply downward trend. Much will depend in the medium term on the speed with which the two companies can get a new handset model onto the market, and then of course on the relish with which consumers respond to it.

Nokia's woes in recent years have been all about failure to secure a foothold at the top end of the lucrative smartphone market, where it has faced serious competition from Apple's iPhone and the newer Android phones. ###

Best to All,

- Eric -