Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Nokia Corp. (NOK) -- Ignore unavailable to you. Want to Upgrade?

To: Grad B who wrote (4759)	4/12/2007 5:50:29 AM
From: 1HumbleGuy	Read Replies (1) \| Respond to of 9255

I was also contemplating on that one. First I assumed that both Qcom's claim and Nokia's claim can be true, since Nokia might have also included royalties they collect. But now in Nokia's latest press release they explicitly mentioned that the aggregate amount excludes all royalty income collected by Nokia. That left me totally confused. Of course I still don't really know how does Nokia calculate this amount of aggregate licence fees. But now I start to see that those two claims are actually contradictive.

To: Grad B who wrote (4759)	4/12/2007 6:30:48 AM
From: waitwatchwander	Read Replies (1) \| Respond to of 9255

3% of what ??? I see Nokia uses the term "aggregate handset sales". How is that defined? Both Nokia and Qualcomm see the same royalty cheque, so the place they differ has to be in the denominator. Here's an example that might work. Nokia sells a handset to an operator for $100 and charges an additional $50 in marketing fees. They send a cheque to Qualcomm for $4 (4% royalty). Then, if they define aggregate handset costs as both costs ($150), they can say their royalty rate on aggregate handset sales is 2.7%. The above is somewhat like what they are now doing with ODM's (or whatever Eric calls them) for their cdma handsets. Partial information to undo confusion only leads one to speculate further. Don't they get it or are they just protecting themselves from issues bubbling up elsewhere? It might also be that Qualcomm is adding in something extra to the top of Nokia's actual cheque. Maybe it is an amount for the cross licencing fees that they are always dancing around. Here is how that would work. Nokia sells the same hansdet but sends a cheque to Qualcomm for $2.70. Qualcomm records the payment as royalty sales in the amount of $3.30 and an royalty expense of $0.60 paid to Nokia for cross licencing. Isn't it time Keitel started spoke up about what is happening with these payments as they proceed through his ledgers. Lupin's words may be legal but they certainly don't seem to be helpful.