Qualcomm has denied reports that it is negotiating with Indian CDMA players, including Reliance Communications, on lowering royalty charges or chipset costs, The Hindu reports quoting the Press Trust of India news agency. “Qualcomm is committed to help the industry drive handset prices down and it involves multiple players and has nothing to do with negotiations on royalties with operators as they do not pay it,” the company is quoted as saying. The company said royalties on devices sold in India as well prices of the devices in the country are the lowest in the world. “Qualcomm is working aggressively to enable even lower-cost devices,” the company said.
Last month Qualcomm Chief Executive Paul Jacobs’s talks with Reliance Communications officials in India broke down on the former’s refusal to negotiate on the royalties issue. After that meeting Reliance Communications said it might migrate to GSM technology.
CDMA subscribers’ share in the Indian market will fall to seven per cent by 2010 while GSM subscribers’ share will grow from the current 75 per cent to 93 per cent, according to consultant Credit Suisse. Nokia, the world’s largest handset maker, has already shelved its CDMA handset manufacturing plants.
This is not a very good news for us here in the neighbouring Pakistan. We are expecting to see our first ever full-mobility CDMA cellular provider (Instaphone/Pakcom) roll out its services later this year in all major cities of Pakistan utilizing existing physical facilities that the cellular operator earlier had for its TDMA operations. The existing 6 operators are all GSM and the handset-pull issue that the new, 7th CDMA operator would face is troublesome by all account. Shrinking CDMA market (both in core and handset) is a bad news, I would say.
GSM has certainly beaten CDMA on the cost factor. Given that CDMA2000 has a better data performance than GSM (non exisitant) and better spectrum effecinency but they dont matter when you consider the dirt cheap prices you can get the infrastructure equipment for. And the prepaid scheme works great with GSM. No need to be locked on to an operator!
It is sad to see a great technology falling victim to lawyer-driven greed. CDMA is clearly the better technology, but GSM has been and still is the far cheaper technology. Outside the US, GSM wins hands down. Qualcomm lawyers have never heard of “good enough” or market disruption by low cost players.