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Spencer-Who knows,maybe it's a three way deal and qcom already has an agreed upon price to purchase IDCC,which then allows nok to accept a rate from qcom that they consider FRAND.The point is, we don't have any idea what is going on behind the scenes,but I will bet that all will be NEGOTIATED and the deal will be a win/win for all parties.Under that premise,the most likely candidate to be acquired is the little guy.Unless qcom agrees to a lower rate for wcdma(which I doubt)there must be another variable that would allow the companies(who are lobbying so hard against qcom 3g rate demands)to accept those rates and still be within the cap that they proposed.This is achieved by removing another ipr company from the equation NOW and FOREVER at an agreeable price that would double(or more)today's price,while being chump change to QCOM,and a very nice return to our 50%+ institutional investors.I'm also sure QCOM would be very happy to own our technology.The DEAL is the key to solving so many of the problems that occur in 3g now and going forward-also just think of how much litigation would instantly be removed.QCOM is and has been buying back its'own stock and the price appreciation from its'average cost would easily be able to finance the purchase of IDCC,without causing even a ripple.I guess this all sounds too easy,but usually the simplest solution is the one that comes to fruition.I highly doubt that Wednesday will bring us any earth shattering news,but it is fun to speculate.jmo
If in fact qcom/nok have come to an agreement and the last sentence in drrtl post re phonenews article has any validity,I would think that IDCC would become a hot speculation stock,with potential for license agreements and/or takeover by qcom.Either scenario should at least double the current price,but the big IF has to happen first.jmo
Report from Barcelona coming up on CNBC!
Makes you wonder what GS has in mind for IDCC,since they are the premier m&a firm in the world.
If you were looking for a sign re HC then how about his selling close to 40% of his shares back in Oct 06? Stock had recovered from July 10 debacle and without any new licenses on the horizon,may have been afraid of another wipsaw.
Wondering if Infineon's delay in announcing the name of the major oem that it signed in December has anything to do with IDCC and possible negotiations with Samsung?
Any speculation here as to which large oem Infineon signed in December and what ramifications this will have,if any,for IDCC?tia.
Thanks Revlis for the link to the conference call transcripts.The qcom remarks re: Project Stockholm were of particular interest and clearly is THE problem that must be solved before IDCC licenses the remaining top tier companies.Altman's view is that one of the objectives of Project Stockholm is to reduce qcom's ability to invent new technology that would disrupt their hold on the wireless market going forward.I imagine that they are not in any hurry to enable a small company from KOP PA to possibly accomplish that fete.Seems like every time nok signs a deal,without the foresight to see the ramifications,they cry foul and want a do-over.The pass-through feature has their shorts in a wad.Don't know how and when this major battle will end,but one thing is clear,the outcome is of great interest to IDCC,and will probably set the parameters for our business model.jmo
twelvebees-I echo your sentiments.An end-game scenario is upon us and the question is where will IDCC be when the 3g mess is finally hashed out? Will we have to fight for the leftover crumbs thru endless litigation to get the major players to pay for our ideas,or will they knock on our door and recognize our contributions and pay us accordingly? This strategy to reduce royalties was hatched 5 years ago,with April 2007 being the focal point or pressure point.For their plan to succeed,they have to get what they want and that is,for qcom to renegotiate a lower net rate to nok without passalongs and double dippings.Without any agreed upon body to determine essentiality and assign a degree of importance to each contribution,the concept of FRAND becomes a joke.Essentially,the qcom/nok agreement will become the guideline or definition of FRAND,and I don't think this will be negotiated any time soon.IDCC management knows this now and increasing the buyback substantially was their way of telling us this.So where does this put us for the rest of 07 and beyond? My guess is that we will continue to sign deals with those companies that don't have their own ipr to cross license,while continuing to put out the litigation stall fires that nok etal create.The frustration and reality of being a small company in an exploding industry, with the challenge of playing hardball with the giants, will finally take its' toll on management and shareholders and I suspect that a deal will be made to buy us out.It would not even surprise me if IDCC becomes a part of the talk between qcom/nok and ultimately a part of the solution.As to what we can do to stir the pot,probably very little that doesn't involve lengthy litigation,except put our ipr up for bid and see where the interest comes from.jmo
Is the Michael Cohen mentioned in the article Corp Buyer?
Great Day for me-I just made the Mschere poster's Hall of Fame.I will keep inquiring(not worrying)and hopefully spurring people to think creatively instead of blindly following,because blind trust usually leads to the slaughter house.I always know where to go for a dose of cheerleading, and I really do appreciate all the hard work you do to keep us informed. You are the master of circumventing a direct question though or at least interpreting a remark out of context.The more informed we are, the better our decision making will be.GLTAL
Mschere-Typical response from the Alfred E. Newman school of investing-What Me Worry! Throw in some rose colored glasses for the Dean of the Newman School.
Mschere-In your opinion,what has caused the delay in further signings of top tier oems? I believe that WM was sincere when he thought IDCC would have more licenses before the end of last year,but obviously the stall continues.So what is the reason the top tier group balks at inking the deals-(a)rates IDCC asking are too high(b)waiting for nok/qcom to set their rate(c)don't believe IDCC really has what they say they have in ipr(d) combination of the above(e)something else that we are not privy to? I do believe that IDCC has essential ipr and that everyone in wireless knows it.The dilemma that we face today is an industry face off that will change the landscape of wireless.Our only option is to litigate and collect for 3g 3-5 years from now or wait patiently for the standoff to to be negotiated and then hope that these companies will license on fair terms.The reason we haven't been able to ink more deals is most probably(b)with (a) and maybe (c) being used as objections, while the stall continues.Would like to see your ideas regarding the above question. tia
L2v-Now we're thinking creatively!Would like to see more discourse on the big picture and where IDCC is going and how they will get there.I appreciate the legal perspectives from the attornies on this board, but dissecting every pacer ad nauseum is boring.We all would love the pie in the sky scenario of all the big boys lining up to sign lucrative 3g contracts,but it has become very obvious that some pretty powerful stuff is going on and the real watershed event is before us.Whether we like it or not,the future landscape of wireless is going to be shaped by the qcom/nok&gang battle and whether or not there is room for two major non manufacturing ipr firms squeezing margins of the oems.I think IDCC is in the catbird seat and can demand a very nice price if that is the way this thing turns out.JMO
Hello McSchere-Anybody home? Obviously I was referring to IDCC being purchased by a company that had cross license agreements with nok.
mschere & kiko- I used to think that way also,but then put myself in nok's shoes and it didn't seem so beneficial to negotiate with IDCC first instead of after a rate had been established with qcom.I still believe that in nok's etal ideal scenario,IDCC's rate will be incorporated in some other company's cross licensing agreement and that they will be pushing this point in their negotiations with qcom.JMHO
If in fact we have to wait for the qcom/nok mess to be sorted out,before we are able to negotiate licenses with the remaining top tier companies,what smaller companies remain that we can license that have a chance of being viable players for years to come? Also,how much of the anticipated 2g win from Sam is priced into our stock,if any,at the current time? tia!
Habu-In a perfect world, I agree, but look how long it has taken to get paid for 2g,even after binding arbitration is in our favor.In comparison to the companies we are dealing with, we are extremely small potatoes at this point.If you think that we can impose our will on them,then you don't understand business.A lot of politicking and collusion goes on behind the scene, that we are not privy to, and we just don't have the clout that the companies we are up against do.Believe what you want, and you may be right,but I still think that when push comes to shove,we will be bought out and for a very nice price.GLTAL!
The question you have to ask yourself is how do the major players view IDCC and how do we fit into the scheme of things?IMO-They view IDCC as a potential great disrupter,as qcom became with its'cdma technology.The more revenues we collect, the more talented engineers we can hire and the greater chance that a killer app is developed or other must have disruptive technology is born.Do they really want to fund a major competitor who could become a giant in future g's? The line is drawn at 3g, only because we were able to come off the mat on 2g and not only survive,but flourish.Everyone has their price,so what is the pucker point for Harry and gang?If this doesn't happen,then expect endless years of litigation,which I'm sure the board doesn't want.We should find out the answer to the question first posed, after qcom/nok set their rates.My guess is that more stalling and more litigation is headed our way until a "white knight" comes riding to the rescue.Hope I'm wrong and that the day when we collect revenues from 75-90% of the 3g market isn't 5+ years down the line.GLTAL!
Re:Qcom/nok dispute-The most interesting comment in the article posted by Gamco was the prediction that qcom would eventually get the same or near same gross rate that they are now getting from nok, but that the net rate would be lowered by the cross license rate nok receives.Nok is only out for nok and even though they are posturing for other oems about capping rates,the real game is negotiating a net rate that gives it a margin edge on the competition.So where does this leave IDCC in this scheme? Ideally for nok etal, someone with cross licensing capabilities buys out IDCC,but if this doesn't happen,then what? It appears that the strategy for now is "Stallgate",tying IDCC up in frivolous litigation with a goal of belittling its'3g ipr in case it has to pay later.The worst case scenario for nok etal is a strong IDCC with everyone paying for 3g.Because our business model allows so much to flow to the bottom line,nok knows it will have to deal with us for a long time to come.Unfortunately,after nok/qcom have negotiated their rates,IDCC will be dealt with,and I'm afraid that more litigation is awaiting us.Any comments regarding a different scenario or perspective would be appreciated.GLTAL!
Just a thought-What if qcom/IDCC decided to fight back and form a joint venture?
Nokiashill-I thought you said it would never happen-now it is 2 years.What do you know that the rest of us don't-you seem so sure of yourself.
Here is a what if scenario that is a win/win for all parties: Qcom agrees to buy IDCC for x amount of dollars in cash and stock-let's use $5 billion as an example.The deal is agreed upon in principle but not until qcom/nok settle their differences, is the deal to be officially consumated.While negotiations with nok go on,Qcom has instructed IDCC to sign up as many players not currently doing business with qcom,and to buy up as many shares as they can while keeping the price in a reasonable range. This sideline deal is the kicker to getting nok to agree upon a rate that the industry can live with.Using debt to make an acquisition of a small company that qcom has on its radar also makes sense and fits in with recent announcements by management.Maybe this sounds far fetched, but it does solve a lot of problems for all.jmho
Dishfan-Great post, the logic is compelling re the company being bought out,but I really doubt the $200 price tag is realistic.Make no mistake about the line being drawn in the sand between the major oems and non handset manufacturing ipr holders.It's all about margins and the wild cards that will determine the margin going forward are qcom and IDCC.The worst case scenario for the oems is IDCC becoming another qcom and greatly affecting the next generations of wireless.Since nok is the first to have its' license renewed with qcom(in April 07)and it is currently the largest handset maker,the showdown is THE event that will dictate the structure of the wireless sector for many years to come.I doubt very much that this situation will be solved anytime soon,if past actions by nok are any indication.I believe that the time frame IDCC and nok agreed upon re 3g infringement is directly tied to qcom/nok reaching an agreement on rates.I also think that this entire situation will be wrapped up in a neat little package with qcom acquiring IDCC,but as much as I would love to see $200/share,the only way this could happen is thru a bidding war with another company who sees IDCC as their ticket into the cross licensing game.The argument that a deal wouldn't be immediately accretive to qcom and therefore qcom wouldn't consider the purchase, is nonsense.I don't expect any major oem to break ranks until the qcom/nok situation is settled and I don't believe it is prudent for IDCC to take any legal action until that time.Unfortunately, we are in a holding pattern,with management going after more of the smaller players that haven't licensed,and agreeing to purchase more shares during this period.Bottom line, I believe that we will all be happy campers when this mess is finally settled-I just hope this isn't drawn out for several more years.gltal!
Mschere-You're absolutely right regarding lawsuits providing another 5 year opportunity for the large oem's.I can't see any reason for any of them signing a license agreement until they find out the outcome of nok vs. qcom.Their agreements with qcom don't expire till a later date, so they can sit back and wait to see if nok is able to negotiate a lower rate for 3g, and only then will they consider licensing with IDCC.The biggest problem we have now is the time factor, because nok always threatens with legal action,but always settles thru negotiation and only after every play has been made.This nok/qcom mess could stretch way beyond april,because nok etal feels that this is THE watershed battle that will determine margins going forward and set a method for essentiality and frand.In a way,the current litigation IDCC is going thru with nok,will pave the way for others to sign after qcom/nok have set the standard,because all the arguments anyone may have regarding essentiality will have been determined in a court of law.IMO, IDCC won't have to go the litigation route with the others,but unfortunately at this time we will have to be content with other deals building our base revenues.Just hope this fiasco doesn't stretch out to 2008 or beyond.
Ghors-Per your post to infinite q is Jan 15 the last day Nok could request to ammend and create the kind of nightmare you mentioned in #4? If we get beyond this date without the request does nok have any recourse at a later date to go this route? tia
So if they sell an infringing product everywhere except the U.S. it's ok? Don't think that was the event,and still think there had to be some benefit to IDCC in order to agree.
Anyone want to venture an educated opinion on how the qcom/nok battle will turn out and how long it will take to come to an agreement on a new contract?This just may be the event that sets the time element on IDCC's ability to bring litigation against nok for infringement.For IDCC to agree to this situation, there must be something in it that benefits IDCC,but I can't figure out what that may be.It almost seems like the current actions in Delaware and England are designed to permanently remove these objections from other oem's in the future and help establish IDCC's essentiality via court decisions.This is just idle speculation on my part and I would welcome any thoughts on how the nok/qcom battle will turn out along with ideas on why IDCC would agree to not bring litigation against nok for 3g infringement for a specified time frame.tia
Agree with Gamco-just the opposite Spencer.Looks to me like the white paper is qcom doing their due diligence before making a purchase and using it as their rationalization to justify the purchase price.jmho
Some day I'd like to see justice served on those jerks that took us down $10 in July on no news and the best justice would be for a blockbuster positive announcement released, say after market on the thurs before option expirations.Hopefully, we could catch some of the same rascals, who profited in the July debacle,in a short position facing a huge gap opening.Wishful thinking,but these things have a way of coming back and biting those that profited from a very shakey and highly suspect situation.Come on Bill,hit 'em where and when it hurts most.GLTAL
Thanks Shill-we're green!!!
Very curious action today-maybe some good news coming!
Spencer-That's a huge over simplification regarding qcom's revenues and net income and how the purchase wouldn't be worth one years income.Deals are made everday for ratios higher than that because it is FUTURE revenues and earnings that key the deal.Would you say the same thing if qcom's rates are determined to be out of whack for wcdma under FRAND, but adding idcc's patent portfolio would offset the loss and in addition give them entrance to td-scdma? Also qcom might not be the only bidder.
I know that I will catch some flak for this but here it goes anyway.Since institutional ownership is at an all time high,does anyone think that the figures will stay that high or increase if the institutions think that the only way for IDCC to license the big boys is to litigate? I'm sure that they have better use of their money if we are looking at years of litigation.We are now languishing in the 30-35 range with a probable sam payment getting us back over 36.These professional money managers haven't parked their money here for the long haul,nor are they here for a small gain.With delay tactics continuing,qcom/nok coming to a head in April or later,and our price being high enough to command a double that would make the fund managers look like geniuses and of course pass easily by shareholder vote,I believe even more than ever,that we are being set up for a buyout.I don't have any info, but I do believe that this is one major reason the institutions have taken an interest in us.Without this likely possibility,I think you would see a bailout by now.I am even willing to go on record, that we will receive an offer sometime within the next 6 months.GLTA-JMHO.
I'm ignorant regarding legal issues,but is there any way IDCC could file some legal action that would require a Markman Hearing to determine essentiality of their patents, rather than relying on a judge to make this determination based on the arguments of both parties.The major flaw regarding the standards board,is that it only establishes what is considered essential to that particular technology and then allows anyone to proclaim essentiality without any system in place to actually determine if it is essential.There has to be a way for some unbiased third party to establish concretely if a particular patent is essential,without going thru years of litigation with each party involved.This flaw was most likely set up to benefit those in power positions with cross licensing capabilities,and to the detriment of companies such as IDCC.We come back to the central question of what action can IDCC take to establish once and for all that its ipr is essential and that nok etal are using this technology in their handsets?Even more pressing is what can we do that won't take years and years to run its course? Putting our ipr on the auction block, might be a way of finding what the industry really thinks of our technology,without going thru the lenghty process of lawsuits etc. Just a thought, but something needs to be done to stop this delay, so that we can properly monetize our assets.JMHO
No Mschere I do not think that everyone has the same thought process as I do and that is why I am asking questions and hopefully eliciting some meaningful dialogue to better understand the problem we seem to have in signing the remaining large oems.I freely admit that I may be wrong in my view as to what is happening,but unabashedly turning away from any concept that isn't cheerleading is even more ridiculous and doesn't help anyone here understand the risks and time horizon we face.You add a great deal to this board and I appreciate your input,but be certain of this, that I too want IDDC to realize its rightful value as much as you do.
Mschere-The companies you listed, to my understanding,do not have their own 3g ipr, and although this should be enough to establish that our patents are necessary to the operation of 3g,the major oems,that have their own 3g ipr,and can offset the cost by cross licensing,seem unwilling to break rank until a fair and reasonable rate is determined by an unbiased third party.Until this happens,we will continue to see a smoke screen of objections, like we are not sure that your declared patents are really essential,although they know that they are.Our dilemma is one of time, and the oems know this, so I just can't see anyone hurrying to license with IDCC until the nok/qcom dispute plays out.We already know first hand how stubborn the finns can be,so I expect them to use every means to force qcom to justify their rate demands and for a system to be in place to determine rates.I think we all were duped into thinking it would be different this time and that being on the standards board would give us the credibility to get deals done without litigation-and it has worked on all but those that have their own ipr.So, what event will move things along faster than litigation,in order for us to receive our rightful share of the market? All JMHO
Mschere-You posted an article from nok at another site that I thought was very interesting,re:nok's view that the subject of FRAND must be decided before 3g and 4g can move forward on a major scale.Two issues seem to be intertwined here,one of essentiality and then what is fair and reasonable for that portion of contribution to the functionality of 3g.It does not appear that nok or any other large oem will budge until these issues are decided,particularly when dealing with a party that doesn't have cross licensing to offer.Since essentiality represents merely a declaration to a standards board with no third party verification,the problems only arise to the large oems when dealing with a qcom or an IDCC.They seem to be willing to only challenge those that don't offer cross licensing opportunities.So,if you are IDCC,you can declare essentiality till you are blue in the face, but it is business as usual for the large oems,until you can specify and get affirmation either from a court or other unbiased third party that in fact the ipr has been deemed essential.Once that battle is won,then what is a fair and reasonable rate for your contribution.This is the thinking of the large oems at this stage and nok is the standard bearer.Unfortunately this unbelievable delay game leads me to one conclusion regarding our fate and that is being bought out,because it solves so many problems within the industry.JMHO-but if anyone could tell me why any of the unsigned major players would voluntarily break this logjam any time soon, I'm willing to listen.
O'DOG-The 10k standardized response is basically a CYA disclosure but if the order in which they listed the basic objections to licensing with IDCC is any indication of the hurdles we must still cross, then I DON'T THINK WE ARE EVEN CLOSE TO CLOSING ANY BIG OEM'S.If we have to go thru a process to prove to all the unsigned major players that we possess 3g patents that are necessary for the functioning of 3g technology,then being on the standards board didn't mean a thing,and we are being played big time.The reluctance of the big boys to acknowledge our ipr and pay for it,just because there is no cross licensing possibility,has got to come to a screeching halt.We have been lead to believe that we have the goods,and I still believe that we do,but there must be a definitive way to spell out very clearly exactly what technology is being used by the unsigned with specific reference to a patent# so that all can see that the patent(s) is being infringed.I've felt that we were beyond this stage and that it was only a matter of coming up with a mutually agreed upon rate or package-to me that is what negotiating means.Otherwise the disclaimer in the 10k,just may be the ultimate rationalization why we are bought out.
O'DOG-The 10k standardized response is basically a CYA