Pierre, but wait, there's more. I've pondered a little and here is something I haven't seen anybody else say. It makes sense to me. Any error of logic anyone can pick up I'd like to know. Repeated from Nokia stream...
To: Puck who wrote (5936)
From: Maurice Winn Saturday, Jul 1, 2000 7:21 AM ET
Reply # of 6001
Puck, if Q! patents were priced correctly, the spectrum auctions would raise a few dollars, not $$billions.
The higher the price, the more that Q! has left sitting on the table for the other monopolist to grab! The other monopolist is the spectrum controller = the governments.
Q! should immediately raise royalties to ensure bids on spectrum don't exceed a few $$million.
$35bn for UK 3G spectrum was about $1000 per person to buy the spectrum rights. That's a value of about $100 per year per person [for 10% return]. Youch! Q! has grossly underestimated the value of their technology. They should be collecting $100 per person per year in royalites, not having that money paid to governments. That implies something like a 20% royalty rate should have been charged. Maybe 30%, assuming average device wholesale prices of $300, which is what a good 3G device should cost.
Q! should immediately raise royalty rates on all their related technology so that spectrum bidders will pay the money to the patent creator rather than the government which is charging a toll.
This is serious and shows how absurdly cheap the IPR from Q! has been. The W-CDMA maniacs can forget about any royalty reductions! They will be seeing 15% or 30% royalty rather than a reduction from 5.6%.
Emergency Emergency Emergency...
Royalty rates for 3G to zoom.
Nokia is in BIG trouble if they haven't already signed. If they are lucky, Q! won't notice that the huge price of the spectrum auctions is a function of how badly undercharged the Q! technology has been.
Q! has warned Nokia [and others] to expect IPR charge increases. We can expect an early lunge by Nokia for a royalty agreement before Q! wakes up.
You can forget about W-CDMA. It is just not in the hunt. It is a year and $100 short. The world will NOT be rolling out W-CDMA anywhere. There are no technical advantages for W-CDMA. The chip rate, synchronisation and all the bells and whistles do not offer any subscriber benefit - just a barrier entry noise and cost.
Maurice
PS: One error is that 35m people in the UK won't be using the auctioned spectrum, so the spectrum value per person is actually higher. So perhaps an annual royalty rate of $200 would be more sensible for Q! to charge. At 40% royalty on a $500 device, we'd come out at $200 but the device would probably last two years, so that would only be $100 per year. We need more!! Heck, we'll have to charge maybe 70% royalty. What the heck, let's charge 100% royalty.
100% royalty should get the spectrum price down to a more reasonable level and get that $35bn into Q! shareholder pockets instead of spendthrift government cofferes. |
