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Technology Stocks : Interdigital Communication(IDCC)
IDCC 348.69+0.8%Nov 14 9:30 AM EST

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To: Jim Lurgio who wrote (3708)1/31/2000 4:39:00 PM
From: Manx  Read Replies (2) of 5195
 
FROM RB: By: renntech
Reply To: None
Saturday, 29 Jan 2000 at 6:23 PM EST
Post # of 47684

Due to the large number of emails presumably requesting lists of IDC's US
patents, I've decided to post what I've found so far. Keep in mind that this is likely
an incomplete list. However, there should be enough here to keep you busy doing
your DD. I haven't been to the boards since Wednesday afternoon. In fact, I haven't
even read the emails that were sent, yet. Following this post, I will catch up on
Yahoo and RB posts since Wednesday, then read the emails, then do some
follow-ups.

IDC and QCOM are IP companies. In order to appreciate their values, one must
have a minimum of skill, at least, at understanding intellectual properties. In order
to follow along, go to uspto.gov and call up US patent 4,675,863 (If you have a
printer and believe you can figure out how to download the images, just download
the front page, the first few pages of text, and the claims.) This was their first
digital TDMA patent. If you hang in there for a few minutes, you will begin to see
just how significant a patent this is, and just how well positioned IDC is in the
wireless communications sector.

If any of this becomes too complex, I would strongly recommend investing in KIDE.
They're a real bargain today at 22 5/8, and they have news, as well. 4Kids, they
announced yesterday, will be presenting at the Seventh Annual Emerald/Home
State Groundhog Day Investment Forum on February 2. This could be really big.

Let's begin with the abstract. This, as it suggests, is a distillation of the main focus
of the invention. In order to follow along, you'll need to take a moment to read this
abstract. I'll wait. Good, you're finish already? OK, now go back and really read it,
because you will become easily lost if you don't. That's better.

The first sentence is a broad statement of the invention - almost an abstract of the
abstract. Please note, though, that the wireless transmission of multiple
information signals was not new at the time of this patent. Neither was the
wireless transmission of multiple information signals utilizing time division
multiplexing. Neither was the wireless transmission of multiple information signals
between a base station and a plurality (= any quantity greater than one) of
subscriber stations. What this patent claims is a bringing together of all of these
technologies into an improved means for providing a lower-cost, clearer sounding
and higher capacity mobile telecommunications system. The rest of the abstract
is a synopsis of how they achieve the same.

We'll now attempt to take this apart and understand its basic components. What?
You're not an electrical engineer? Good, then we're even.

To begin with, we have multiple subscriber stations. These could be cellular
phones. There is a base station, as well. The base station is connected to a
network, say, a TELCO, for example. Spacial diversity, or range, is accomplished
through the use of multiple antennas. Thus far, we see nothing new. We have,
however, defined the environment within which our new invention will be applied.

Find the heading: "Summary of the Invention". In the text version found on the
uspto.gov web site, it immediately follows the claims. In the printed patent version,
it follows the drawings.

The fourth paragraph, which begins: "The base station operates over...", defines
what they call a "transmit channel circuit" which prepares data to be sent from the
TELCO to the cell phones and a "receive channel circuit" which captures the data
received from the cell phones and prepares it to be fed into the TELCO. The data
being sent by the transmit channel circuit, and the data being received by the
receive channel circuit travels along a pair of radio frequency (RF) channels.

Are you still with me? If not, might you reconsider KIDE? It's even a greater
bargain in after-hours at 22 7/16.

The next paragraph describes something quite unique. Here we have the data
lines coming from
the TELCO being converted from analog to digital signals. Each data line has its
own digital converter.

The next paragraph - paragraph 6 - describes a truly amazing process.
Remember that "transmit channel circuit"? It also has a number of signal
compression devices that simultaneously compresses all those streams of digital
signals coming at it from those digital converters we just talked about. Next, a
"channel control unit" takes those compressed digital signals and combines them
into a single stream of digital data which the patent refers to as a "transmit
channel bit stream." Each one of those original digital signals now occupy
repetitive, sequential slots within the transmit channel bit stream (Time Division
Multiple Access or TDMA).

In the next paragraph, we see that an "exchange" couples the digital converters to
associated compression devices.

The next paragraph - paragraph 8 - describes something called a
"remote-connection processor unit." Basically, what it does is to assign a time slot
to an incoming call. The time slot, remember, is that repetitive sequence where
compressed data was positioned in that final transmit channel bit stream we
discussed above. When the remote connection processor detects an incoming
call, it immediately assigns a digital converter and its associated compression
device to the call. This is when the process of converting the data to digital, then
compressing it begins. The remote-connection processor further includes a
memory for storing information about which compression device was assigned to
which telephone line. We need to know this because each compression device is
assigned to a specific sequence of time in the final transmit channel bit stream.
Somewhere down the road, it is going to become important to know which time
slot was assigned to which telephone call.

In paragraph 8, we learned how the remote-connection processor unit detected
the presence of an incoming call, then assigned a digital converter and a
compression device, together with its associated time slot assignment. In the next
paragraph, we have a "call processor" connected to the remote-connection
processor that detects the assignment of a time slot (the remote-connection
processor assigned the time slot just above), then permits the connection with the
exchange, or TELCO.

Here we have digital TDMA in its most generic form. A wireless communications
system having multiple fixed or mobile subscriber units (cell phones, for example),
a base station connected to an external network (a TELCO, for example), said
base station including means for converting data received from the said external
network into digital data (the digital converters), means for compressing the said
digital data (the compression devices), means for sequentially combining the said
compressed signals into a single transmit channel bit stream with each of the
respective compressed signals occupying a repetitive sequential slot position in
the said transmit channel bit stream (transmit channel circuit) and memory means
for storing information associating said digital converters with their respective slot
sequence in the said transmit channel bit stream (remote-connection processor).
Here, too, we have a very crude, and admittedly poor example of some of the
longest sentences known to the English language - Patent Claims. But, more on
claims a little later.

If you wish to continue reading this patent, the following paragraphs explain, in a
similar reverse fashion, how signals are received and processed from the
subscriber units (cell phones). As this would be a bit redundant, I wish to move to
a brief discussion of present-day mobile telecommunications in general.

As analog mobile telecommunications is relegated to the history books together
with Windows 3.1, AT PC's, and other dinosaurs of the
pre-10-years-ago-technology age, digital communications has become its only
feasible alternative. At present, there are two predominant methods of delivering
this digital data in use today - TDMA (in one form or another), having its genesis
in the above subject patent 4,675,863, and narrow-band CDMA - the brain-child
of Qualcomm. With small exceptions here and there, narrow-band CDMA is the
predominant delivery method in the US, while TDMA predominates the rest of the
world.

For a general overview on Qualcomm's narrow-band CDMA spread spectrum
technology, your attention is directed to US patent 4,901,307 to Gilhousen, et al.
We will examine Qualcomm's current narrow-band CDMA technology, as well as
their 3G (or 2.5G, as some have termed it) narrow-band CDMA more closely in a
later post. For now, think of it as several data streams flowing continuously - as
opposed to separate, stacked groups as in TDMA - within a single RF channel
where each data stream is coded. The receiver, knowing the code sequence of
one of these data streams, extracts only this data stream from the RF signal.

My reason for being so bullish on IDC has more to do with the strength of their
position in this sector than with the relative technological merits of TDMA v.
narrow-band CDMA. (As an aside, one might conclude, however, that the broader
implementation of TDMA technology world-wide might suggest certain
advantages over narrow-band CDMA). IDC's strength can only be measured by
the strength of their intellectual properties, or patents. The heart of a patent is(are)
the patent claim(s). Let's take a moment to discuss this most important subject.

What is a patent claim? A claim, you might say, is a very specific, legal definition
of an invention. Drafting a good claim is an acquired skill. In a claim, you want to
capture as much of this new idea without claiming prior art. While the claim might
include elements of prior art, its combination, application, use, etc., should
encompass as much of any future application of this new idea as possible. This is
called drafting a broad claim.

Let's take a chair, for example. Take a look at the following claim for a chair:

A horizontal planer surface maintained in elevation by four downwardly extending
support means.

Hmm. Sounds like a chair, all right. But what about a three-legged chair? A
broader claim might read something like this:

A horizontal planer surface maintained in elevation by at least one downwardly
extending support means.

That's better. Now we have encompassed a four-legged chair, a three-legged
chair, as well as a chair with a single support attached to a weighted, circular
base. This latter claim is, therefore, broader in scope than the former. Remember
the old flourescent lights from the 30's and 40's, how they flickered? The flicker
was due to the charging cycles of the gas inside the glass tube. Someone came
up with a brilliant (pun not intended) way of eliminating the flicker from our visible
perception by simply inserting a certain type of metal on the inside of the tube
opposite the charging electrodes. The problem was, his claim specified a certain
type of metal. Phillips, I believe it was, realized that virtually any type of metal
would produce the same result. Bummer.

Returning to the chair for a moment, it would be more appropriate to claim a
four-legged chair in what is called a "dependent" claim. A dependent claim
derives its complete definition in combination with its identified "independent"
claim. If the second, broader claim were claim (1), a dependent claim (2) might
read something like:

Claim 2: A horizontal planer surface according to claim 1 wherein the said
downwardly extending support means comprise four (4) vertical members of
substantially equal length.

In a patent, you may have more than one "independent" claim. One independent
claim may describe a machine for manufacturing a shoe comprising this part and
that function. In the same patent, another independent claim may describe a
method of manufacturing a shoe comprising a method of doing this and that.

Having provided a reasonable overview of IDC's digital TDMA, its distinction from
narrow-band CDMA, as well as the importance and general mechanics of patent
claims, it is finally time to bring all of our knowledge together and take a look at
claim 1 of IDC's US patent 4,675,863 to Paneth et al.

Before we do, though, let's have a brief refresher on the digital TDMA technology.
What do we need in order to accomplish digital TDMA communications with cell
phones? Well, we need multiple subscriber units (cell phones), first of all. We
need a base station connected to a TELCO, don't we? And, if this is going to be
"digital" TDMA, I guess we'll need something to convert the data from the TELCO
into digital signals. Digital converters should do nicely. Now, if this data is going to
fit with other digital signals on the same frequency channel we had better
compress it, so we will also need some digital compression devices. We're also
going to need something to sequentially combine all these compressed digital
signals into a single transmit channel bit stream where each of these compressed
digital signals will occupy respective and repetitive time slot sequences in this
newly-formed single transmit channel bit stream. A transmit channel circuit should
do just fine, thank you. Finally, lest we forget which time slot each compressed
digital signal was assigned to, we will certainly need a memory means for storing
and accessing this information. This shall be accomplished by our most faithful
remote-connection processor.

Now, just feast your eyes on claim 1. If, at any time, doubt ever overcomes you
concerning IDC's future, just read claim 1 over and over again. It is digital TDMA
in its purest, most generic terms. And they own the rights to it in patents
throughout the world.

OK, let's look at it together, shall we? You will notice that the beginning paragraph
is set apart from the rest of the claim with the word: "comprising." That paragraph
defines the environment, and is not a claimed part of the invention. Look at the
rest of the elements of this claim, and ask yourself: "Would it be possible to
accomplish digital TDMA in the absence of any one of these elements?"

- We see a means for converting the data from trunk lines to digital.
We have digital compression means for compressing the signals
We have the channel control means to combine the signals into a single transmit
channel bit stream in time-divided fashon
There is an exchange for coupling the digital converters with respective digital
compression devices.
The remote-connection processor follows, and the method of coupling the trunk
lines to converters is described, as well as the function of assigning time slots.
The memory feature is also described that remembers which compression
devices were assigned to which time slots. This sections also describes the
remote-connection processor's method of answering a call and beginning this
whole process.
In the next section, the call processor receives a signal that a slot assignment has
been made and causes the exchange to complete the call.
Finally, a transmitter sends the transmit channel bit stream over a given RF
channel.

Lest any of you begin eyeballing KIDE, let me limit my discussion of the remaining
claims just say that they are "dependent" on claim one. There are no other
"independent" claims.

It is most unfortunate that claims 1 through 6, and claim 10 of this patent were
among those that were invalidated by the jury in the Motorola decision. And, no.
The Patent Office cannot reverse an invalidity decision by a Federal Circuit Court
via ReExamination. They can, however, revalidate claims of a patent which were
not the subject of an invalidity decision. This is what IDC has been pursuing, and
achieving. So, when you see the same patent number among those that were
invalidated by the courts as among those revalidated by the PTO, you can rest
assured, the PTO only revalidated those claims which, shall we say, are still in
good standing. It should be further pointed out that when a court invalidates a
patent - or certain claims in a patent - in one country, that decision has no bearing
on the enforcement of patents in other countries. Thus, claim one (1) of this
subject patent continues to be in force throughout Europe, Japan and elsewhere,
and is yielding royalties accordingly.

The ReExamination results granted in November of last year were described by
someone as the shot across the bow. If fact, that description was quite meet. It
was a signal to Ericsson and the small number of remaining dead-beats who have
been awaiting the PTO's decision before deciding their next step. The PTO
ReExamined several of IDC's core patents in light of volumes of prior art. The
revalidation of these patents were most significant in that it finally eliminated any
vestige of doubt concerning IDC's claim to the digital TDMA territory.

You know, most people view a potential settlement with Ericsson as one of the
biggest hurdles for IDC. No. They are over their biggest hurdle already. Oh, yes.
An Ericsson settlement might be a boost to moral. The extra cash would be nice,
too. But, a settlement with Ericsson will pale in comparison to the elation they
must have shared over the PTO's validation of their patents over all the prior art
Motorola, Ericsson and others could throw at them. Why?

There are still a few hold-outs out there. Now, what do you expect them to do when
they receive a letter from IDC gently offering them to settle-up by a certain date or
face certain litigation. If these hold-outs opt for litigation, where are they going to
find sufficient prior art to substantiate their claims of invalidity? Take a look at US
6,014,374 to Paneth et al. It is a continuation of the patent we have been
discussing (US 4,675,863). (Think of a continuation patent as one that is very
similar in relation to a previous one) IDC has listed pages upon pages of prior art.
They are obviously on the ball with this prior art game.

No, my friend. The Ericsson trial is just this side of moot. IDC has already one. I've
been dying to show you why so that you can see it for yourself. Now, just sit back
and enjoy the next year or two. As for 3G, however, I still need more information.

Renntech

The following post is an article regarding IDC landing its first big account - AT&T.
In this article it states that IDC was looking for 5 percent royalties. Any number
crunchers out there?
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