J:
<<Re: Royalties. We know that Wind will earn unit royalties between $1.40 and $1.70
for the Intel/I2O deal and slightly higher for the DEC/I2O deal(per the Q2
conference call). Are those typical royalty numbers we would expect from some of
the other high volume deals you mention, such as the automotive and telecom deals
(Qualcomm and GM in particular)?>>
To my knowledge, WIND has never specifically articualted what the royalties are for both the GM and the Qualcomm deal. I am very interested in the Qualcomm deal, because I believe that this arena (including DSPs) has the best chance to rival I2O in eventual total unit volume. Some deals WIND is free to divulge, and with others, the clients ask for anonyminity. Qualcomm has been on the quiet side.
You are correct in your thinking however. What we do know from both WIND and the analysts (specifically DMG) is that WIND does get a royalty for each product using either VxWorks or IxWorks. Typically, this royalty structure is individually negotiated, although it typically scales down depending on unit volume. For example, an industrial machine with 1000 units might pay $1000 per unit, while a router with 10,000 units scales to $10 per unit. The last time I checked, WIND believed that their average deal was for the 10-20,000 unit range.
However, as most of us on this thread have indicated, WIND is in the process of negotiating some very big unit deals, specifically I2O related. They also have signed some potentially large non-I2O deals, such as Adobe and the often specualted Qualcomm.
Hope this is helpful.
Jason Cogan |
