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Exactly, not sure how one would point out the one time charge that is non-business related due to legislation vs new information on the tax rate of 13%. If half our revenue is taxed at that rate we are talking about 17% tax rate overall. That is half what it was before. This is a big driver imo.
Dclarke
I think the run up was artificial due to talk of 15% corporate tax and other business incentives at the time. We are about the same as we were before that boost in late 2016 and early 2017 I think.
Dclarke
I think this shows the trend.
https://www.statista.com/statistics/271496/global-market-share-held-by-smartphone-vendors-since-4th-quarter-2009/
Dclarke
Does anyone know if there has been any activity in any litigation against LG recently? Any associated reduction in current or future litigation expense is always a bonus...
Dclarke
I believe over the years I have heard Merritt mention that crowing about a win in court when negotiations are active can have a negative effect on the mood of the parties or something like that. Makes sense to me.
Dclarke
Sent a nice note to our friends at Arete that constantly bashed and called IDCC the greatest short etc. I had a lengthy exchange with them back in 2012 when they told me the patents were worthless and IDCC did not hold much in LTE. They had insider knowledge in the industry lol. I was told they were top analysts and were not to be questioned. You wonder how these guys keep their jobs...
Anybody else seeing that ad for Interdigital popping up online stating "Smart cities could waste $341B by 2025 on IoT Deployments... How much are they spending on these ads I wonder?
DCLARKE
Starting at an generational low with interest rates at zero for 8 years will tend to lift the markets don't you think? What if we had actually had 3% growth once?
DCLARKE
He has the memory of an NFL corner back. How one can be so confident in their forecast after missing it over and over is amazing.
DCLARKE
This is such a great example post. Where do you see the market going from here and what about IDCC?
DCLARKE
The problem with a PE for past earnings is that it usually contains some catch up revenue that is not recurring. That will always keep the PE down because the market is discounting those non-recurring items imo. Not saying that you are incorrect it is probably a combination of the fundamentals/outlook and the political backdrop. Small business optimism is at an 8 year high as well and money is flowing into the market in anticipation of actually growing over 3% for once.
DCLARKE
Who cares WHY Samsung signed a 10 year deal with Interdigital. Maybe the CEO was spurred to settle by message in a fortune cookie. It certainly wasn't settled because they think they are not infringing. Just sayin...
DCLARKE
Quick Thoughts...
In my opinion I think we have a couple things that are working in our favor to get deals done in the nearer term like the Samsung deal. First, Interdigital is showing that they are not going away. They have the balance sheet to survive and will not stop the litigation until they are paid a fair rate for their inventions. Second, they have dropped their asking rate a bit from what I heard from Merritt a few months back. So you can keep fighting and paying attorneys money that will never be recovered, unless you think Interdigital will either give up or go out of business. It makes perfect business sense to just negotiate your best rate and move on. IMO, we will see a few more deals this year possibly including Apple and Microsoft. As for Nokia, they are on the hook for so much money they will fight until the bitter end. We might never see a dime from them. The only problem they may come across is the fact that they are now an NPE as well... That being said I would be happy with a decent rate from Microsoft going forward.
Dclarke
Is Merritt going to be on CNBC fast money? I see a tweet that seems to suggest that a few minutes ago...
Dclarke
Based on what BM said this am:
$500-600M in revenue
$100m Base expenses
$80m in legal fees currently
I think we are looking at about $5-6 per share in earnings potential in the next few years. This Samsung deal might drive some inevitability into the stock price in terms of the target of $500-$600M.
dclarke
I am feeling a dividend raise in the near future... Or worst case a new buyback announced
dclarke
Should be nice when we see the legal fees start to trend down...
dclarke
Maybe Microsoft really likes Nokias position?
Dclarke
"We", you are still in this cant miss stock? Your son still in it as well, lol. Nice call on this one. lol
dclarke
Not sure what impact this has but our PE went from about 7 to 37 with the drop off of the patent sale quarter. Our forward PE is less you could argue but that change could have triggered some action by some computers. The BBY sale cancelation probably is having some effect as well imo.
dclarke
How will this SEP Veto effect the standards setting process? Will there be less declarations of essential patents? This veto is a win in the short term for the infringers but sometimes you need to be careful what you wish for. Now that FRAND is the focal point, the large manufacturers are going to have to march out with what they have been asking for. This new factual record will be a new target for others to show that Nokia and others say one thing and do something else. Nokias past actions could really bite them in the future as the new "willing licensee".
Dclarke
A better auto correct on my phone? I can assure you I know the difference between their and there. How is our dndn bet going. Has your sons portfolio recovered yet? Lol
Knowing you just made that statement erases any doubt for me that they will hit there goal. Go dndn...
Dclarke
Sounds like its you.
dclarke
I am guessing part of the reason we are down is due to BlackBerry earnings
Thanks for posting that on a day like today... but not unexpected from you.
Imo the deal with Nokia would be done if Merritt was going to forgive past royalties and give a prepayment discount of some kind. Nokia's bill continues to rise and forgiving would be toxic to current negotiations with Samsung and any future negotiations with current paying customers. This stall by Nokia could set them up for a big problem real soon.
Dclarke
Very well stated as well as a fair view of any QCOM vs IDCC analysis. QCOM will be a great cash generator with lower growth but a great investment anchor. Idcc has a chance going forward to add some sizzle to potential returns but with added risk.
Dclarke
The stock had a nice 5 day run after the pre-hearing brief was filed...
Good point. I was thinking that many of those phones were just 2G and with an ASP of $36 there is not much meat on that bone. If you think there is some good money in those feature phones I am good with that.
Dclarke
Nokia is guiding to -2% margins in their first quarter. Based on their most recent report it looks like their Networks business is making some money and handsets loses money especially when taking into account license revenue. I would not brag about a business no matter how big that loses on every device sold. You can't make up per unit losses with volume. How many phones would Apple sell at a break even price? Nokia is a shadow of its former self and I am sure that changes the dynamics in licensing discussions on a number of fronts. IMO, any settlement will include something creative such as patents or other avenues. IMO, Interdigital cannot afford to let Nokia off on ANY past revenue if they want to be taken seriously in future discussions with other manufacturers.
Dclarke
Maybe Nokia strategy is to go out of business so they don't have to pay any royalties to Interdigital. What is Nokia? 10th in smartphone market share? 3%? There days of dictating to the industry are long over. Based on my research our Sony license is looking better and better. take care.
Dclarke
My guess is that Merritt will offer the current FRAND rate of say a bit less than a buck a phone including that same rate for EVERY phone sold since April 2006. If this does not happen it sends a very bad message to Samsung and others in terms of piling up past royalties. IF Nokia wants to take it to a potential ban the rate increases to Nokias FRAND rate which is probably 2X more. I still think that opening up Nokias rates in their contracts will really put pressure on them to settle.
dclarke
So you think Nokia will wait until they have no leverage? Then tell Merritt what rate they will pay? Nokia is arrogant but not that stupid. Just wait until the ITC sees Nokias FRAND rate to their licenses. Do you think Merritt will file that in the Nokia ITC case? Nokia will probably argue invalidity but I don't see them waiting for a ban as the rate could go up 50% or more.
dclarke
You were right at the top in terms of contribution before so I am sure that would continue.
Dclarke
Rev, time for you to come back to the fold. Why dont you join the new board as the clowns are staying at IHUB...
Dclarke
LG's market share was 5.6% in Q1 and falling. Maybe look at the overall market share and see which are gaining. I know 50% - 8% = 42% is simple math bit is wrong.
LG Market Share Article
Over Market Share Article
Dclarke
Ronny, I should have put a comma in there after the word shares. My point was that all the management lynching has been enflamed by the share price decline. So what I meant to convey is that if the share price was still trading at the high we would not be talking about the lack of management purchases or most of the other issues that we all agree need to be fixed. The share price can fix everything, just like winning fixes everything in sports.
...."Would it matter if insiders had bought shares, if the stock price was still $58?"
dclarke
I did not mean to imply that you are directly critical of management. I was really just speaking about the board in general. You and Jim really run the board imo so you get credit bad or good for what goes on here. If you think this board is functioning well then there is no need to discuss further.
Dclarke