BUSINESSWEEK ONLINE: AUGUST 14, 2000 ISSUE

Readers Report

Qualcomm's Prospects Aren't So Shrunken

Perhaps I should be pleased with ''Hanging up on Qualcomm'' (News: Analysis & Commentary, July 24), since it is a mark of the success of CDMA that many now claim to be its parent.

W-CDMA, the so-called European standard, is in fact based on Qualcomm's inventions and is a revolutionary change from the TDMA technology used in GSM in Europe. Qualcomm Inc. has a large and growing pool of CDMA patents, applicable to voice and the increasingly important business of wireless Internet access.

Although others have expended considerable efforts to work around a small number of our patent claims, with a measurable negative impact on performance, our patent coverage of the standard is ubiquitous, and W-CDMA manufacturers will need a license from us. We are extending our licenses to W-CDMA with the same royalty rate that applies to CDMAOne and CDMA2000. Many leading manufacturers have already signed up, and more will be announced soon.

South Korea has been and remains a crucial market for Qualcomm. CDMA remains an important product to Korea since it is now a major export for Korean manufacturers. Korea will be the first nation in the world to field a commercial third-generation system. The reference to ''dumping of Qualcomm technology'' refers to the technology choice for new spectrum yet to be licensed. I doubt that there is any intent to use TDMA or another ''XDMA'' in Korea's third-generation systems. Thus, no dumping will occur, and users of the new spectrum will also benefit from Qualcomm technology.

Rather than concern about our ''prospects around the globe looking increasingly shrunken,'' I am kept awake nights by concern that W-CDMA will be delayed or not work well, and thus the upgrading of the whole world to CDMA, whichever flavor, might be delayed where CDMA2000 is not selected.

Irwin M. Jacobs
Chairman and CEO
Qualcomm Inc.
San Diego

Don't get confused by the recent ''noise'' from Korea regarding CDMA2000 and W-CDMA. The carriers are talking about using W-CDMA for new spectrum that has yet to be auctioned off. The media are reporting this as ''Korea switching from Qualcomm technology to the European standard.'' No one is switching.

Many involved in the negotiations agree Korea will probably end up with both CDMA2000 and W-CDMA networks. The fact that two Korean carriers will begin service on their CDMA2000 networks this fall is proof that Qualcomm's technology will exist in Korea for many years to come. In fact, the real question is why Korea would even need new spectrum. The country is 60% saturated, therefore 2X voice capacity would cover every human in Korea and a few pets as well.

Anatole Raif
Carlsbad, Calif.



e-Books May Merit e-Awards

In ''Story of E'' (e.biz, July 24), Diane Brady stated that the National Book Foundation ''won't add an e-book category'' to the National Book Awards (which are awarded annually in the categories of fiction, nonfiction, poetry, and young people's literature). That statement does not accurately reflect the foundation's position. The foundation's board is actively studying developments in e-publishing and e-books. While our four-category structure will remain in place for the 2000 Awards, it is premature to say that the foundation ''won't'' recognize e-books in the future. We have added and changed categories and genres several times during the Awards' 50-year history.

And it is wrong to characterize the current policy as a ''snub.'' Our mission is to bring the joys of books and authors to adults and children throughout the nation. E-books clearly appeal to a wide public, and if they can be used to further our mission, our board of directors will endeavor to find an appropriate way to embrace this new technology.

Neil Baldwin
Executive Director
National Book Foundation
New York



Staff Lunches Are Not a Revolutionary Idea

I laughed when I read how some dot-com CEO started holding lunches with small groups of employees to gather their frank input (''The fight for survival,'' e.biz, July 24). Just one more indication of how inexperienced so many dot-com ''leaders'' are. I was meeting with employees over lunch about 20 years ago when running my first company. And the ''park-your-brain-at-the-door'' style of management became obsolete long ago. The people who do the work in most companies usually have the best ideas.

Young, energetic founders have great motives and personal enthusiasm, but running an enterprise made up of people who expect to be led doesn't portend well. I guess experienced leaders can teach young dogs some tricks.

Jim Alampi
Novi, Mich.



Prosperity Fights Crime Better Than the Police Do

In ''Tough justice is saving our inner cities'' (Economic Viewpoint, July 17), Gary Becker argues that police and court procedures that put a disproportionate number of young minority men in prison make inner cities safer, causing businesses to move in and create jobs.

Excusing ''lamentable'' racially biased police practices and courts so that employers will move into inner cities and hire minority workers ignores a more direct solution: labor market policies.

There is strong evidence that, during the 1990s, the prolonged economic expansion--specifically, sustained low unemployment--played a substantial role in reducing crime. Policy tools that promote full employment, better education and training, and work supports are better choices for reducing crime and bringing jobs back to the inner city.

Ellen Houston
Labor Economist
Economic Policy Institute
Washington



Gene Marcial: Redoing the Math

In computing the results for ''Gene Marcial: How's he doing?'' (Finance, July 24), you must subtract first day's gains, since most of this is included when the stocks start trading on Friday.

You also have to take into consideration brokers' charges on buying and selling 155 securities, which are greater than what you would pay for a single index.

Donald Singer
New York



''Apple'' (Cover Story, July 31, 2000)

In ''Apple'' (Cover Story, July 31), Kevin A. McCarthy, an analyst at Donaldson, Lufkin & Jenrette, was incorrectly referred to as Kevin McDonald.



''Don't be fooled by this low profile'' (Information Technology, June 19, 2000)

''Don't be fooled by this low profile'' (Information Technology, June 19) misstated the revenue of AMS Services Inc. The figures that appeared were for American Management Systems, an unrelated public company. AMS, a privately held firm, declined to reveal its 1999 revenues.





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LETTERS:
Qualcomm's Prospects Aren't So Shrunken

e-Books May Merit e-Awards

Staff Lunches Are Not a Revolutionary Idea

Prosperity Fights Crime Better Than the Police Do

Gene Marcial: Redoing the Math

CORRECTIONS & CLARIFICATIONS:
''Apple'' (Cover Story, July 31, 2000)

''Don't be fooled by this low profile'' (Information Technology, June 19, 2000)

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