SPOTLIGHT: ABI: Qualcomm not to blame for higher CDMA costs

A new report from ABI Research says Qualcomm isn't to blame for the cost differential between GSM and CDMA handsets. Carriers in India and Latin America have been pressuring Qualcomm to reduce its royalty rates for CDMA chipsets, claiming they are the source for the price differential between CDMA and GSM handsets. "The issue of royalties is just a convenient lever that carriers are using to put competitive pressure on the CDMA silicon market," said principal analyst Stuart Carlaw. ABI Research found that royalty costs for CDMA shipments into India were in the region of 5 percent of the total handset sale value. This is in line with Qualcomm's policy of normalizing royalty fees at the 5-percent mark on a global scale. The sole exception is the Chinese internal market where a 2-percent to 3-percent royalty fee is applied. Said Carlaw: "Comparing low cost CDMA2000 and 2G GSM devices is a bit like comparing apples to pears." Article

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