Re: QCOM Royalties
DS,
QCOM and SPINCO will cross-license essential and useful patents. QCOM gives SPINCO enough IPR to bargain for cross licensing with GSM IPR holders; Whereas, QCOM receives, in lieu of money, from SPINCO, the right to select future patents from SPINCO for new IPR or that extend old IPR. Thus, SPINCO pays no royalties to QCOM on their CDMA ASICS or to anyone on their CDMA/GSM ASICS.
Current CDMA royalties continue as in the past, with QCOM collecting a royalty on CDMA products from their manufacturers based on their average selling price, whether: handsets, laptops, or ASICS, (anything using CDMA that requires a license also generates royalties). SPINCO sells ASICS, collecting no royalties.
On handsets, QCOM collects about 4-5% of the manufacturer's selling price (I am not sure about details of MSP's with base stations or new devices). With multimode handsets, manufacturers would pay QCOM royalties for its CDMA IPR and also pay other's (about 15% to as many as 11 who own GSM IPR) their royalty percentages.
The European's cross license from one another, but this cross licensing does not pass through to others. Similarly, I assume that SPINCO will cross license with GSM to avoid paying GSM royalties, but that this will not pass through to manufacturers who use SPINCO's chips. Because QCOM asserts that they will still be paid for their CDMA IPR.
So, I do not believe that DS is correct when he says, "If a mfgr buys ASICS from SPINCO, they will pay no royalty fees to anyone, including GSM IPR holders." His use of "they" is possibly ambiguous. Assuming that he intends "they" to refer to "manufacturers," the manufacturers will pay; assuming that his "they" is referring to "SPINCO," they will not pay.
I hope this helps.
Don |
