I’m in Hollywood

Chapter 718 Speculative Mentality

Eric and Chris spent the month of May on firefly investing in telecom operator Sprint.

The two parties have already determined a general transaction plan in early May. Sprint privately issued 400 million additional shares to Firefly Investments in exchange for a capital injection of US$1.32 billion. After the transaction, Sprint’s total share capital expanded to 4 billion shares. The stake is 10%, and it has two seats on Sprint's board of directors. As long as this transaction is successful, Sprint will also adopt Qualcomm's CDMA technology, driven by Firefly's investment.

However, after the two parties formulated the transaction plan, the matter is far from over. Although the legal threshold of the communication industry is gradually loosening, as an industry that is strictly regulated by any country, if you want to enter smoothly, you still need to go through layers of review.

Firefly and Sprint first need to submit their plans to the U.S. Federal Trade Commission (FTC) for antitrust review. Firefly Investments not only owns Qualcomm, which is involved in the research and development of the underlying technology of mobile communication, but also controls Nokia, which produces mobile communication base stations and terminal equipment. If it successfully invests in Sprint, it will basically open up the entire mobile communication industry chain. Suspected of monopoly very obvious.

If it was ten years ago, this transaction plan would have been rejected by the FTC immediately after it was submitted, but in recent years, the federal government has continued to relax legal restrictions on the telecommunications industry, which makes the transaction plan possible.

In late May, the FTC finally approved the deal after Eric and Chris attended several FTC hearings about the deal in person and privately launched public relations lobbying.

In response to the FTC, Firefly Investments and Sprint also filed related applications with the Federal Exchange Commission (SEC) and the Federal Communications Commission (FCC). After the passage of the most variable FTC, the remaining two departments were much simpler. Almost within a week after the FTC approved the transaction plan, the SEC and the SEC successively approved the transaction applications of both parties.

On May 26, the signing ceremony of Firefly Investments and Sprint was officially held at the Sprint Group headquarters in Manhattan.

At the press conference after the signing ceremony, Firefly Investment and Sprint executives officially announced to the public. Sprint will carry out in-depth cooperation with Qualcomm to build a nationwide mobile communication network using CDMA technology.

A month ago, Verizon announced its participation in the CDMA camp after receiving $300 million in directional bond financing from Firefly Investments. at this time. The Sprint Group, which owns nearly half of Class A and Class B mobile communication licenses, once again announced its participation, marking that the disputes over the US mobile communication technology standards over the past few years have finally settled, and CDMA technology has not only escaped the fate of being completely abandoned,

It has also successfully occupied more than half of the market in the US mobile communication field.

Just after the press conference, Qualcomm's stock price on the public market began to rise in a straight line. As of the close of the day, the stock price soared 8% in a few hours, and the price per share easily exceeded the $30 mark, reaching $31.5. Compared with the stock price of around $17 at the end of last year, Qualcomm’s market value has risen in just half a year. 85%, it's only a matter of time before doubling.

The last time I went to San Diego, Qualcomm's communication equipment manufacturing plant had just begun to select the site, and it would be at least the end of the year to start large-scale production. Although Sprint agreed to adopt CDMA technology, it was impossible to wait for half a year. They decided to temporarily The G** network will be deployed in the Washington area. In addition, Qualcomm planned to cooperate with Sony to build a factory, but the plan was rejected by me. Even if we want to cooperate, the target should definitely be Nokia. This is also a good time for Nokia to enter the US market. We licensed a full set of CDMA technology to Nokia before we took control of Nokia in 2010. Although Nokia is focused on G** research and development, there are still some foundations in this area, and they can also provide a group of professional managers to Qualcomm's equipment manufacturing plant.

The time was the next day, which happened to be Saturday. After a busy day yesterday, most things were finally over, and Chris brought Emily to East Hampton.

However, the two soon got into Eric's study and talked about business affairs. Of course, the topic started from Qualcomm, and Chris knew it very well. Eric's recent series of layouts are largely for Qualcomm.

Eric leaned on the back of his chair and listened to Chris finish, and said: When it comes to G** and CDMA, I was thinking that there must be no way for either party to drive either party out of the market in a short period of time. Therefore, the mutual integration of these two technologies is the most correct way. Just like this DVD format dispute, the two DVD technology standard camps are very smart, and they did not waste another ten or eight years on R+ and R-. Instead, we chose to support each other.”

DVD standards have been in place for some years, but the major Hollywood studios have been trying to delay the release of DVDs due to concerns about the lower cost of DVD piracy.

But after the delay, it is impossible to delay any longer. With the foreshadowing of the Sony videotape lawsuit, Hollywood can no longer expect to pass the lawsuit to prevent the appearance of DVD. It is expected that after the summer vacation, several major DVD manufacturers will launch DVD players. .

Chris also knew a little about this information and said: The standards mastered by the two DVD technology camps are actually the same generation technology, and it is not difficult to support each other, but G** and CDMA are two completely different generations. The technical standard is now, and it is basically impossible to integrate it.”

Eric said: I am not talking about the integration of operators, but the integration of terminals. Nokia has G** technology and Qualcomm has CDMA technology. Both parties have very deep technical accumulation in these two standards. Therefore, it is certainly not difficult for us to launch a mobile phone that can support both G** and CDMA networks.

Dual Netcom and full Netcom mobile phones that support multiple network standards are very common in later generations. However, in 1995, the new generation of digital communication technology had just been popularized on a large scale. Several major technology camps were thinking about how to squeeze each other out of the market, and did not consider coexistence or even integration. Therefore, multi-netcom mobile phones are definitely a very novel concept .

Chris's eyes lit up immediately and said, Eric, this idea is really great, I think it's better for us to hold a conference call tomorrow. Discuss with Jorma Ollila and Owen Jacob. In this case, mobile phones that support both G** and CDMA networks certainly don't have a big market in Europe, but North America has determined the coexistence of G** and CDMA. This kind of mobile phone is definitely promising.

You make arrangements. Jurassic Park 2 will be released on June 2, and I can probably stay in New York for a week, Eric replied, and he also planned to have a recent meeting with Nokia CEO Jorma? Ollila talks in detail.

Nokia was the first communications equipment maker to bet on G** technology. This is also the key to its rapid rise in recent years. Although it does not have a complete monopoly on CDMA technology patents like Qualcomm, Nokia has the largest number of patents in G** technology among the world's major communication equipment manufacturers.

A few months ago, after the news of Firefly's investment in Qualcomm came out, Joma Ollila had doubts about Eric's approach in an email. In his opinion, blocking Qualcomm's CDMA technology is more in line with Nokia. Interests. Now, instead of doing this, Eric strongly supports CDMA technology and grabs half of the US mobile communication market, even though the reaction of Joma Ollila is not intense on the surface. There will definitely be pimples in my heart.

While Eric had explained his intentions to him over the phone and email, more communication would certainly be beneficial.

Only by maintaining sufficient communication and understanding each other's intentions can Eric be assured of handing over the properties under his name to the managers, and he can also spend more time doing other things.

Chris habitually took out a small memo from his shirt pocket and took a serious note of this matter before saying to Eric: This matter is settled, I think we should talk about Yahoo! already.

I have been communicating with Ian and the others recently, and I understand their general thoughts. Eric nodded and said.

The original equity incentive contract expired this year, and the Firefly Investment team has begun to evaluate the work results of Yahoo's key management in order to determine the share of equity incentives they can get.

Eric's original plan. After the end of the equity incentive plan, Yahoo's IPO plan was launched.

But recently, several executives have unanimously hoped that Eric could delay Yahoo's listing date. Their reasons are also quite sufficient. The capital market is extremely profit-seeking. Once Yahoo goes public, the company will have to face performance pressure. And give up the current steady development strategy step by step.

Under the repeated lobbying of Yahoo's management, Eric also began to seriously consider this issue.

A few years ago, Eric's original idea was to list Yahoo in 1995. When the Internet bubble quickly swelled, the Yahoo stock in his hands had also passed the lock-up period, and he could take advantage of the inflated price of Yahoo's stock price from the capital market. Cash out large sums of money.

In the final analysis, Eric's original plan still had a very obvious speculative mentality, subconsciously only thinking about cashing out and leaving, rather than running Yahoo well.

After several years of precipitation, Eric also realized that if he keeps this mentality, his career will definitely encounter a bottleneck one day in the future.

Seeing Eric's thoughtful look, Chris asked, So, Eric, what do you think now?

What about you, do you agree with their ideas too? Eric smiled and asked rhetorically.

Chris nodded unabashedly: The capital market is very eager to invest in the Internet, so I think we delay listing for a few years, and when Yahoo has a clearer profit prospect, we will definitely be able to obtain greater returns.

Eric recalled that in the original time and space, the Nasdaq market started exponentially in 1998, and it soared from more than 1,000 points to 5,000 points in just two years.

If Yahoo went public after 1998, the funds raised by its initial stock offering would definitely be several times higher than it is now. However, under the strict financial supervision system, the funds will be used for the development of Yahoo itself, which does not belong to iResearch. Although it is possible to transfer some funds through some methods, there are very legal risks, and it is definitely safer not to take off the shares in your hands.

Cash out, cash out, cash out...

Eric repeated the word in his mind for a few years, and suddenly realized that he was not short of money at all. No matter how much money he cashed out, he still had to use it as an investment.

The curve in his mind was suddenly straightened, and Eric also felt a sense of enlightenment, with a smile at the corner of his mouth, and said to Chris: That's it, postpone the IPO plan, but anyway, we should hurry up Complete the IPO before the contract with Microsoft goes into effect.”

Of course, Chris also laughed relaxedly. If Eric insisted, he really didn't know how to persuade him: Speaking of which, Microsoft's Windows 95 will be officially released in August, but, I think you should have used this system, Microsoft's stock price has been rising recently, and the market seems to be very optimistic about this new system?

Although Microsoft's Windows 95 is determined to be released at the end of August, in fact, many test versions have been released. Outside the United States, pirated CDs have become widespread.

Eric also used this operating system that he was very familiar with in his previous life as a matter of course, and said: I think this system may allow Microsoft to monopolize the operating system market, so we will likely have to go head-to-head with Microsoft in the next few years. Microsoft has completed its dominance in the operating system market and will definitely enter the Internet market. I'm not even sure if Bill Gates will forcibly tear up that agreement, after all, Microsoft probably won't be willing to wait until 1999.

I think Microsoft is getting restless now, Chris smiled and said, Steve called me a few days ago and said that Microsoft had contacted him, hoping that he could leave Yahoo and join Microsoft's upcoming Internet division.

The Steve that Chris was talking about was Steve Mitnick, who was in charge of Yahoo's technology department, a good friend of Chris's college days. In Eric's view, several of Yahoo's key managers, Ian? Grenier, Jeff? Rock, Steve? Mitnick and Tina? Brown, among the four, Steve? Mitt Nick is the most important to Yahoo, because he is almost in charge of the core technology research and development of Yahoo's major Internet products. If he is poached, Yahoo will definitely be in turmoil for a long time.

Eric was surprised: Really?

Chris nodded, saw the worried look on Eric's face, and smiled: However, don't worry, I know Steve's character very well, since he called me, it means that he will definitely not Leave Yahoo.

Of course, Eric couldn't be so completely relieved and asked, What about the others? (To be continued.)