Spent a few more hours (like 6 :) in Syracuse than I had intended and tipped a few more than usual after the great win over UConn. In the morning I will realize (once again) that I'm not young anymore and will probably pay for this for at next 2-3 days. No, I didn't rush the floor with the kids but I did make haste in the other direction to the men's room ... must have been 'holding it' for most of the second half. Anyway, I better say something about Gemstar because my bed and pillows are making a compelling argument.
Here and/or on Yahoo I've read some posts concerned with the non-exclusive nature of the Comcast and Echostar licensing agreements, and also of the fees as derived on a per unit basis. With Gemstar-TV Guide I believe that prudent precautions are being taken not to revisit any antitrust issues again. The fact that these licensees paid upfront monies for the next 10 - 20 years is all the validation I need for the breadth and strength of the intellectual property portfolio presently and into the foreseeable future.
What formula does one use to calculate the licensing fee on a unit basis? Henry Yuen said about 5 or 6 years ago that 'in the end, it may come down to which remote the viewer picks up' which struck me as an odd statement at the time and why I have thought of it often. (Regardless of what you may think of Henry, no one can deny his visionary abilities.) I believe each video screen will have access to multiple IPR interfaces, whether it be from a single carrier, multiple carriers (to include streaming internet one day) or the consumer electronic manufacturer. The latter will come from the imbedded IPG in the TV itself, the DVR/PVR, DVDR or some combination. What if a Comcast subscriber has a Toshiba HDTV and a Sony DVR/DVDR unit? And what of TV Guide Online with its patented search engines and interfaces? I suppose one scenario would be for the viewer to have to decide between TV Guide On Screen, TV Guide Interactive or TV Guide Online. Microsoft will likely be in the living room somewhere with its licensed IPG. TiVo will compete although I still don't like the business model. Pioneer is licensed to use the IPR in its own PassPort IPG for cable and it will use TV Guide On Screen in the consumer market.
The Plug & Play mandate/agreement is the end of the stand alone cable box beginning in a few months which is (IMO) will be seen as a win-win-win for the cable carrier, the electronics manufacturers and the consumer when its looked back on in a few years. You can see that Motorola got into the DTV business anticipating this and I think this could bring SFA to a settlement. With DirecTV, EchoStar and every major CEM (armed with Gemstar's IP) set to compete with CableVision and Cox for the IPG interface I also think this could bring about more cable licensing agreements.
I reinvested back into Gemstar about ~6 (?) months ago and it was for multiple reasons: Plug & Play, CEM licensing agreements, Jeff Shell's refocusing of the company and less distrust that Rupert Murdoch's intentions (paranoia) might not be in the best interest of the Gemstar shareholder. Since that time more agreements have followed, even more impressed with Shell and the 'less distrust' is almost nearing trust.
I don't come online much these days and am invested back in with a longer term perspective. I'd probably be the last one to ask if the company is undervalued, overvalued or fairly valued. Anyway, who would listen to someone that was scared as hell when GMSTF was at 4 (split adjusted), thought it had much further to go when it was a 107 and was in complete denial until bailing at just under 5.
Regards
Stew |
