Tuesday, November 02, 2004

That's what I'm talking 'bout

Down South in Kings of Leon country, where I'm originally from, some people sometimes say this for emphasis or when they are feeling vindicated about something, or at least that's the way I remember it. Thinking back to my post on bloggers vs. analysts from last Friday I would like to point to yesterday's Qualcomm MediaFLO announcement as a pretty good illustration of how this might work in practice, and I'm surprised that more hasn't been written on this today - maybe it's that little election going on across the pond.

Last week I noticed a few blog posts asserting that Qualcomm was concerned about the Intel-Clearwire deal and explaining exactly why it should be in a frank manner, including Andy Abramson's and the very good post he links to. Viewed from this perspective, yesterday's announcement should have been pretty easy to predict, at least in hindsight. But brokers simply can't go around writing this sort of stuff publicly, though they may well say it in emails or in phone calls to investors. Most of the fund managers I know avoid answering the phone, and many have a true love-hate relationship with email. If they read the right blogs, then the poor analyst may have struck too late using these media (if even successful in getting the message across in the first place), and a timely and interesting insight may be reduced to an undifferentiated retread.

So what about MediaFLO? For my money, being able to build an alternative national broadcasting platform which is compatible with both 3G flavors, for $800m, is a significant claim to make, and a compelling one for the carriers. While it adds to the already baffling array of choices facing the telcos for their next move in wireless technology (Wi-Fi/WiMax, Flash-OFDM, TD-CDMA), for the wireless operators it's coming from a familiar (maybe even friendly) party, and they could reasonably expect that it will be optimized for their existing business model, rather than a tool for further disruption. Better the devil you know. Reuters newswire is reporting that Sprint is in talks with Qualcomm over this, already. My wireless infrastructure analyst colleague is quitely massaging his temples.

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