C2, re: NOK6 (POS) / Q raising royalty rates, and “my understanding of what thinkclear wrote is that a licensee gets access to all the patents in existence at the time the license gets signed. New patents are not part of the menu.”
This is where we disagree. During the effective period of the license there is what the Q calls “the improvement period” wherein all patents acquired automatically become incorporated into that existing license. Thus as Altman states below, “ In a CDMA phone under our license agreement, a licensee can do a CDMA OFDMA phone and there would ***not*** be an additional increased royalty above the standard rate.
Going back to Altman’s statements (Nov 2005)>>>
“The other thing that I wanted to point out is that there's not an additional QUALCOMM royalty above our standard WCDMA, CDMA2000 royalty rate. So what this means is if you look back over the last 10 years, you've seen that our patent portfolio has grown very substantially. We haven't increased our royalty rate during that time, so a licensee gets access to more and more of our patented technology.”. As we make more and more investments, as Paul talked about, with the chart that showed all the increasing R&D investments, all of these technologies get licensed to our licensees without an additional royalty rate requirement, and those can get incorporated into a CDMA phone, and they get the benefit of that increased R&D.
An example of that is also taken in the multi-mode context, so in a CDMA phone, we're talked about the Flarion acquisition as we continue to get OFDMA intellectual property.In a CDMA phone under our license agreement, a licensee can do a CDMA OFDMA phone and there would not be an additional increased royalty above the standard rate. So unlike if we did not do the acquisition, and OFDMA and CDMA were combined in a phone, Flarion's intellectual property would not be covered, and these companies would have to then go individually negotiate with Flarion. |
