Tags: Reliance, Tata

Qualcomm claims royalty on handsets in India is logical

CDMA operators in India have been complaining about high royalty charged by the technology developers Qualcomm. However, the US based wireless technology giant Qualcomm has claimed that the royalty accounts for just around 5% of the handset costs and it goes into the research and development efforts of the company to further develop the standard.

Qualcomm also claimed that their CDMA technology remains superior to the competing GSM standard for telephony. Chief Executive Officer Paul Jacobs said that a typical USD 40 mobile phone has just around USD 2 as royalty.

He said: “If we cut that royalty rate even in half, it’s only a dollar as compared to what we did by creating competition and got handset prices down by 25 percent.”

Indian market continues to be dominated by GSM players though Reliance and Tata Teleservices are gaining customers at a fast pace.