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Federal Communications Commission Permits Qualcomm to Use $114 Million Auction Voucher for Debt Retirement of Other Companies Utilizing CDMA

– December 20, 2002 – SAN DIEGO -- December 20, 2002 -- Qualcomm Incorporated (Nasdaq: QCOM), pioneer and world leader of Code Division Multiple Access (CDMA) digital wireless technology, today announced that the Federal Communications Commission (FCC) has amended the terms of Qualcomm's "Auction Discount Voucher" (ADV). The amendment allows Qualcomm to use the remaining $114 million of the ADV to satisfy existing FCC auction debt of other companies. Qualcomm has no FCC auction debt.

The FCC originally awarded the ADV to Qualcomm in response to a U.S. Court of Appeals decision ordering the FCC to designate Qualcomm a "pioneer" under the Commission's Pioneer's Preference Program, and to grant Qualcomm spectrum in accordance with the rules of that program. Under the Pioneer's Preference Program, the FCC awarded grants of spectrum to technology innovators to promote the rapid development and deployment of new services to consumers. In 1992, Qualcomm was denied a pioneer designation for its development of CDMA. The U.S. Appeals for the District of Columbia Circuit twice reversed the FCC's denial of Qualcomm's preference request.

The spectrum Qualcomm initially requested in its pioneer's preference application had subsequently been auctioned, so instead of a specific spectrum license, the Commission awarded Qualcomm a transferable ADV in the amount of $125 million that could be used to reduce a winning bid in forthcoming spectrum auctions. Under the terms of the ADV, Qualcomm could either use the ADV to obtain a license of its own choosing, or could transfer the ADV in whole or in part, to other auction participants. The FCC's recent order did not change these terms of the ADV.

Qualcomm has since transferred approximately $11 million of its ADV to Summit Wireless, LLC for the grant of licenses that were auctioned by the FCC last year.

However, many additional spectrum auctions planned by the FCC were postponed. As a result, Qualcomm did not have sufficient opportunities to utilize the entire voucher. Under the terms of the revised voucher, Qualcomm is permitted to transfer the voucher, in whole or in part, to any company utilizing CDMA technology that holds auction payment obligations to the FCC for Auctions 5, 10 and 11.

Qualcomm Incorporated (www.qualcomm.com) is a leader in developing and delivering innovative digital wireless communications products and services based on the Company's CDMA digital technology. Headquartered in San Diego, Calif., Qualcomm is included in theS&P500 Index and traded on The Nasdaq Stock Market™ under the ticker symbol QCOM.

Except for the historical information contained herein, this news release contains forward-looking statements that are subject to risks and uncertainties, including the Company's ability to successfully design and have manufactured significant quantities of CDMA components on a timely and profitable basis, the extent and speed to which CDMA is deployed, change in economic conditions of the various markets the Company serves, as well as the other risks detailed from time to time in the Company's SEC reports, including the report on Form 10-K for the year ended September 30, 2002, and most recent Form 10-Q.

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Topics: Corporate
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