NEW YORK (CNN/Money) - Is it safe?

That question -- in addition to provoking squeamish feelings from fans of the movie "Marathon Man" -- is one that tech investors are asking during this rough year. Wall Street lately seems to prefer more stable tech stocks than hot growth plays.

The 30 S&P 500 tech and telecoms that pay dividends are down 8 percent this year. That might not be something to get overly excited about. But consider this: The Nasdaq is down 12 percent and the 61 S&P 500 tech and telecom companies that don't pay dividends are down an average of nearly 20 percent.

"We're finally seeing dividend payers starting to outperform. That's a healthy long-awaited sign that people are seeking out quality," said James Denney, manager of the Electric City Dividend Growth fund.

And there have been some notable standouts among the dividend payers.

Qualcomm (QCOM: Research, Estimates), which began paying a dividend last year, announced it was boosting its dividend by 40 percent last month. Its stock is up 28 percent this year.

The love for dividends is so strong that even MCI (MCIP: Research, Estimates), fresh out of bankruptcy, has rallied nearly 20 percent since the company announced earlier this month that it would begin paying a quarterly dividend of 40 cents per share, which works out to a whopping 9.6 percent yield based on Friday's closing price.

Yield signs These six dividend paying techs and telecoms have bucked the market's downward trend this year. Company  Dividend yield  YTD price change*  Autodesk  0.3%  48.0%  Qualcomm  0.8%  28.3%  Alltel  2.8%  13.4%  Sprint  2.7%  11.9%  Verizon Communications  3.9%  11.4%  Adobe Systems  0.1%  11.2%   * as of 8/13/04  Source:  Thomson/Baseline

For a look at more dividend paying winners in tech and telecom, check out the chart to the right.

Linda Duessel, co-manager of the Federated Equity Income fund, said that dividends from tech firms, even if they are relatively small, are helping to make some tech stocks more attractive to investors that want to take part in some of the sector's upside but with slightly less risk.

"More companies in the tech sector are instituting and raising dividends. That's good for investors who are value oriented and realize that a dividend is a piece of a return," Duessel said.

Microsoft's (MSFT: Research, Estimates) stunning decision last month to double its regular dividend (the new yield will be 1.2 percent) and issue a special one-time dividend of $3 a share was proof to some that a high tech company can offer investors the steadiness of a decent-sized payout while still investing in growth initiatives.

"Microsoft has shown increasingly good stewardship over shareholder's capital," said Denney, who owns the stock in his fund.

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And there has been talk that Microsoft's move could pressure other tech leaders, such as Cisco Systems (CSCO: Research, Estimates), Dell (DELL: Research, Estimates) and Oracle (ORCL: Research, Estimates), to eventually start paying dividends.

One problem is that these companies still use much of their free cash flow to buy back stock to offset potential dilution from options grants.

But John Snyder, manager of the John Hancock Sovereign Investors fund, which owns Microsoft and fellow dividend-payer IBM, said that there is no reason why tech companies with lots of cash and little debt like Cisco could not afford to pay a dividend and buy back stock as well.

What's more, Snyder added that he expects several chip companies that already offer dividends, including Linear Technology (LLTC: Research, Estimates) and Analog Devices (ADI: Research, Estimates), to keep increasing their payouts, even as they buy back shares.

"I believe these companies should and will decide they can do both," Snyder said. "There are a lot of tech companies with very strong balance sheets."

Denney said that cable companies could start paying dividends in the near future.

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None of the top cable companies, including Comcast (CMCSK: Research, Estimates)t, Cox Communications (COX: Research, Estimates) and Time Warner (TWX: Research, Estimates) (which owns CNN/Money), currently offer dividends. But Denney argues that the major cable operators have largely built out their infrastructure, have taken advantage of lower interest rates to lower their debt loads and are generating healthy amounts of free cash flow.

And since the cable companies are competing more aggressively against telecom firms for business, it would make sense for their stocks to offer the type of dividend potential that telecoms have, Denney said.

Not all dividend paying techs have done well this year. Hewlett-Packard (HPQ: Research, Estimates), Intel (INTC: Research, Estimates) and AT&T (T: Research, Estimates), for example, have been pummeled this year.

But many of these stocks, because of their drops, might now be more attractive to traditional, income oriented investors, said Duessel. As such, she said her fund owns HP and Nokia (NOK: Research, Estimates), which has fallen this year due to market share losses in the cell phone business.

Both stocks now have dividend yields that are above the S&P 500's average of 1.7 percent. HP yields nearly 2 percent while Nokia's stock yields about 3.2 percent.

And Snyder thinks that HP would be wise to consider increasing its dividend to soothe shareholders angry after the company's earnings warning last week.

The reporter of this story owns shares of Time Warner though his company's 401(k) plan.