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Data, each case is different and needs to be negotiated. Where they can't agree, ultimately it's the coutts that decide after the patent holder sues the user of those patents for non-payment.
What I was suggesting was a way of resolving those impasses short of litigation while at the same time letting the patent holder receive a reasonable payment.
Just like baseball arbitration (I believe).
What's misssing is a definition of FAIR in FRAND or a way of arriving at a fair price.
I was suggesting a way of arriving at that figure in a timely manner while at the same timing forcing licencees to pay a fair price while a final price is arrived at.
What if the requested rate is unreasonable? Say, hmmmm 10%?
Here is a suggestion for dealing with the FRAND issue based on, I believe, some sports arbitration of salary issues process.
Each side makes an offer and a third party (the courts) chooses which side is more reasonable. This forces both sides to at least try to be reasonable or they no doubt lose in arbitration. Until the case is settled the one seeking to use a FRAND patent has to pay the patent holder at the rate the seeker proposes in the arbitration process.
A special arbitration court could be set up to deal expeditiosly with such cases.
No, in the booklet that they send out, the first company described is IDCC. The lithium company is third. The second is a PC board manufacturer.
3 Motley Fool Recommendations
I just placed an order (will cancel later).
Their number one recommendation is IDCC. They say their "earnings potential is dizzying". The sale is only mentioned as an aftertought.
I could see each having 3m shares but bought on the open market at exactly the same price? Doubtful.
They have no reason to do that and should the deal not get done they'd be open to law suits.
At the end of the BNN clip Shuttleworth says the sale "will take a little while" because of all the patents IDCC has.
Wonder what "a little while" means in weeks or months?
Good analysis, however, in time phone prices should drop with all the competition and so will licencing fees based on sales revenues.
I think the chatter is all in his head. What's the word for that?
Oh yeah, schizophrenia.
"blamed valuation" is much clearer. lol
What does "aimed valuations" mean?
Exactly my point. 2,800 puts is 280,000 shares. The post talked about 2,800 put contracts.
You'd need to put up hundreds of thousands of dollars in your account or have sufficient margin (or be short 28,000 shares to be able to sell those puts, at least with iTrade.
Up a bit? It's up $1.08 or 2.5% although the volume is only 36,000 at this time.
Actually the chart suggests a bottom has been reached.
You can't compare the reports on IDCC and the perhaps false information published by an analyst accusing SVM of falsifying company revenues, earnings and cash in their financial statements. That kind of claim, if proven to be false, will result is significant penalties that will be meted out by the courts.
I don't believe IDCC can go after a company that claims to be reporting on rumours and stating that the report is based on rumours.
The accent was named Moshe? lol
Looks like a sudden sale of 100,000 shares or so in minutes.
Good points olddog. It's all very complex. I'm an EE but not particularly knowledgeable about patents. Learned more about it since getting into IDCC than ever before.
Don't know. I'm not a FRAND expert. There are references in the document which no doubt have some examples of rates set by juries. Check it out if you're interested. I'm not.
Just trying to understand the literature and apply common sense. By definition, FRAND rates should be less than the max some may charge. If that were the case there would be nor reason to even to have such a thing as a FRAND patent.
Read the document I posted. In cases where FRAND disputes reach the courts, juries can set FRAND rates.
Interesting (if lengthy) examination of the legal issues related to FRAND.
http://www.cravath.com/files/Uploads/Documents/Publications/3234075_1.pdf
Yes, I'm a paid lobbyist for Intel, Nokia and Apple. That's why I spend time on this board to try to influence FRAND rates.
From info I've seen posted elsewhere, FRAND rates are much lower than the 3% you suggest. However, if you were right, I'd be very happy.
No, the market does not set FRAND rates. The whole point of FRAND is that if one companies patent is included in a standard, forcing all comapnies to use that patent, the patent holder can't be allowed to hold users hostage. The benefit to the patent holder is that everyone pays the toll without the need for negotiations or lawsuits. The downside is that rates are less than what could be charged if not a FRAND patent.
It's up to the patent holder whether he submits the patent for inclusion in the patent. No one forces a company to do that.
The "R" in FRAND stands for Reasonable.
A reasonable rate is one that's historically been used in such cases. My guess is around .5% to 1% per patent.
Cheer up. 10 cent dividend today!
Twitter 40 minutes ago. No idea who Pransky is. Hope he is lowballing the price.
Zachary Prensky
@Zackfoot Zachary Prensky
$IDCC - buying this name. I Think sale process still on track, $INTC consortium most likely suitor in the $60-70 range
Well done John!
Mickey - obviously. I was being facetious. I thought it was obvious.
FISH - you really should call Icahn and offer him your services. He clearly needs your help to choose his investments.
IDCC top pick on BNN along with Walgreens and Visa.
Market Call Tonight:
Gordon Reid, President & CEO, Goodreid Investment Counsel
FOCUS: U.S. Equities
Market Outlook: Macro issues, such as solvency concerns in a number of European countries have been a significant drag on equity prices. Goodreid expects an eventual resolution allowing the market to focus on solid corporate earnings. As such, we would use the current weakness as a buying opportunity.
TOP PICKS:
The Walgreen Company (WAG NYSE) Latest purchase was Sept, 2011 at $36.
Walgreen’s stock price is depressed because of a stand-off with pharmacy benefit manager Express Scripts. Goodreid thinks an agreement is likely, but in the worst case should affect earnings by about seven percent. At 11 times 2012 earnings, we believe this represents good value.
Visa (V NYSE) Latest purchase was Sept 2011 at $88.
The growth of electronic transactions is impressive and as the largest player in the space Visa stands to benefit. At 17 times 2012 earnings it continues to trade at a discount to its historic multiple.
InterDigital (IDCC NASDAQ) Latest purchase was June 2011 at $40.
Interdigital is exploring strategic alternatives and we should soon know the results of bids by major mobility players. Their patent portfolio is impressive and yields a strong and growing flow of licensing revenue.
Clearly no one knows what a Google or Apple might bid for IDCC, but the figures in the article (below) seem reasonable.
The $3 B figure is likely to be closer than some of the extreme numbers thrown around here. My question is what revenues do IDCC's other patents generate. That number is probably known by some, but I'm not prepared to spend the time to try to decipher.
A good estimate for IDCC can then be estimated by taking the $3B figure, adding the cash and at least ten times the earnings from other patents to arrive at a reasonable number.
I'm not asking you to make that estimate as you seem to think it's impossible. It can't be impossible, as the potential bidders are doing just that, although they do have more information than we do.
Quote from article below:
According to Mr. Misek’s analysis, Motorola has the fourth-largest share of “essential” LTE patents or 9%, which he values at approximately US$3.3-billion. He defined “essential” LTE patents as being those “related directly to technology that is strictly required to meet the technical specifications of the LTE standards.”
Nokia Corp. was also estimated to control 9% of all essential LTE patents with a total value in excess of US$3-billion, which is good news for Mosaid Technologies Inc. The Ottawa-based patent firm gained control over 2,000 Nokia wireless patents earlier this month, with more than 1,200 of them considered essential to various wireless technology standards.
Obviously that's true. But if the other patents generate $100 million a year, that's worth at least $1.5 Billion. So I guess the question is how much to their other patents generate now or are likely to generate next year.
Interesting National Post article. The article values MMI'and Nokia's LTE essential patents at around $3 Billion. They have the same 9% of essential patents as IDCC. So if IDCC's essential LTE patents are worth $3 billion, what are the rest of the patents and other company assets worth which will add to that $3 Billion valuation?
No contradiction at all. Google may have valued the MMI patents at $12.5 B but may feel no need to acquire any futher patents to meet their strategic objectives, in which case they'd value IDCC's patents at zero, assuming they have no need for them. I'm pretty sure that if Google hadn't bought MMI, they'd be much more keen on getting their hands on IDCC.
Another, say HTC, with perhaps few strategic 4G patents may value them higher than what Nortel was sold for. So values depend on the time you carry out the valuation and the value of those patents those need them.
As far as I know, no one has established how badly various companies may need what IDCC has.
I don't care how other companies value their assets. That has nothing to do with the price IDCC will receive. The question is how these companies value IDCC's patents at this points in time.
Just because Nortel got $4.5 B does not mean that IDCC will get the same even if our patents are better. If you need to hold your pants up and a belt comes up for sale you'll play a lot if you need to keep your pants up.
If a pair of suspenders now becomes available, it may be worth little, unltess you're ultra cautious.
So the question is, what does IDCC have that Nortel or MMI did not and do the companies that bought Nortel and does Google need for for defense or offense.
I don't know the answer, but I think this must be part of their thinking.
If Google has a similar number of communications related patents, (and they might with the MMI patents) Apple will have no advantage over Google wrt to communications. How much advantate would the IDCC patents give either one in the comm. field? That's the question.
The problem is we don't know how Apple, Google and the others are thinking AT THIS POINT IN TIME after the MMI and Nortel sales. It's not so much the intrinsic value of the patents that matters (relative to MMI's and Nortel's patents) as much as what it can do for Apple and Google now that they have the patents they bought earlier.
I can easily see them wanting what IDCC has but they are probably not as desperate now as they were earlier.
I hope you're right as I have several thousand shares and options but I'm not as optimistic of reaching or exceeding $6 Billion as I was earlier.