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To: Robert who wrote (31671)	6/3/1999 7:39:00 PM
From: gdichaz	Respond to of 152472

To Robert: Sigh. No. How in the world can you come up with that conclusion? Gregg's statement could not be clearer. The Q will get royalty payments consistent with each contractual agreement. That says nothing whatsoever which could be stretched to a interpretation that only the Q and Ericy will receive royalty payments for 3 g. It goes to the point that the Q negotiates its own royalty payments directly with each other company. What other companies claim is irrelevant to what the Q receives in royalty $$$s. Chaz.

To: Robert who wrote (31671)	6/3/1999 7:41:00 PM
From: Gregg Powers	Read Replies (5) \| Respond to of 152472

Robert: RE: Are you saying that Q and E will be the only patent holders to receive royalties for 3G? I am not suggesting this at all. Let's put this in perspective. Qualcomm developed a body of intellectual property that proved central to the commercialization of mobile direct sequence spread spectrum. Recognizing that it is better to participate in a large opportunity rather than dominate a far smaller one, Qualcomm management adopted a strategy of licensing its core technology to major wireless equipment manufacturers including Lucent, Motorola, Nortel, Samsung, Nokia etc. All of these agreements provided the licensee would pay Qualcomm a fixed royalty, based on the manufacturing transfer price, in exchange for the right to use Qualcomm's intellectual property. If a licensee required additional IPR in order to achieve its intended design specifications, it is incumbent on the company to license this technology from its rightful owner (and pay additional royalties). Incidently, one of the advantages of CDMA over GSM is that so much of the core IPR is available from one vendor, i.e. Qualcomm. I have seen several studies indicating that a new entrant to the GSM market, with nothing proprietary of its own to trade, would wind up entering into in excess of ten license agreements and paying royalties in greater than twenty percent (of manufacturing transfer cost). So my point is simple. Qualcomm gets its pound of flesh, which I estimate to be between 3% and 5%, from each and every manufacturer of mobile CDMA related products, regardless of the deployment mode selected. Thus the royalty terms are contractually established and fixed. All the best, Gregg