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Technology Stocks : Qualcomm Moderated Thread - please read rules before posting
QCOM 178.29-1.6%Dec 12 9:30 AM EST
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To: kech who wrote (52707)6/23/2006 3:17:34 AM
From: barty  Read Replies (4) of 196952
 
this IPR issue is alot more serious than that. Firstly, if Nokia does not need a CDMA license, its a clean slate for WCDMA IPR negotiations, where basically they line up their patent position with Qualcomm. Remember that legacy agreements (CDMAOne) formed the basis for Qcom to get their WCDMA "rate". Take that away and their bargaining power shifts significantly. You'll find that Nokia's patent position in WCDMA is huge - far bigger than Qcom's in WCDMA (which is largely confined to the radio layer one). That's well accepted in my view.

What happens if we don't see a settlement before APril '07 - well Qualcomm could try seek an injunction but they would not be able to recognise revenue on Nokia's WCDMA shipments (where their share is approaching 30%). That would hit their '07 earnings hard. Nokia could just take a provision every quarter on the balance sheet.

The point here from Nokia's perspective is that they think their patent position is bigger than Qcom's and if that's the case what is fair and reasonable? Remember Qcom have to license their patents on FRAND terms - and there's a pretty interesting question that courts will no doubt have to decide in the end. If Nokia gets a big concession it will mean the have a massive cost advantage over rivals.
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