As an IDCC holder who likes to read this board, I think you might find this interesting in view of the recent discussions about Qualcomm's royalty rates.
Posted by: revlis
In reply to: None Date:5/31/2006 5:52:22 PM
Post #156664of 156669
Qualcomm Royalty Obligations to End
By Kim Tae-gyu
Staff Reporter
A senior official at the Electronics and Telecommunications Research Institute (ETRI) Wednesday confirmed Korean mobile phone vendors’ royalty obligations to Qualcomm will partially expire this August (See the front page of The Korea Times, Dec. 2 edition).
ETRI can verify the expiration date since Qualcomm has to return 20 percent of royalties, which the outfit gathers from Korean code division multiple access (CDMA) phone makers for their local sales, to the state-backed institute.
``Qualcomm will stop paying back parts of royalties collected here to us after this August,’’ ETRI director Lee Gyu-ho, who is in charge of the institute’s research strategy planning division, said.
``Qualcomm will do so because Korean CDMA handset producers will be freed from paying any royalty to Qualcomm for handset sales here in Korea starting this August,’’ Lee said.
Qualcomm, which retains most source techniques for CDMA, gave the privilege to ETRI, the co-developer of the mobile telephony technology, while striking licensing contracts with four Korean firms including Samsung Electronics and LG Electronics in 1993.
His claims are in tune with the contents of the confidential deal between Qualcomm and Samsung, which The Korea Times was allowed to view last December.
The contract copy indicated Samsung’s obligations to pay CDMA royalties to Qualcomm will come to an end in 2006 for local sales and 2008 for exports from Korea.
``Following the 15th anniversary hereof, the license hereunder to licensee (Samsung) shall be fully paid up and no further royalties shall be due from licensee for subscriber units (cell phones), which are sold after the fifteenth anniversary hereof,’’ said the contract signed in Aug. 1993.
It added, ``Provided, however, that licensee shall have no obligation to pay any royalties on subscriber units, which are sold for use in Korea after the 13th anniversary hereof.’’
Lee guessed Samsung or LG might cut down on the royalty rates in the 1993 contracts _ 5.25 percent of handset prices for domestic sales and 5.75 percent for outbound shipment _ afterwards.
However, he said Qualcomm might not change the conditions on royalty expiration without the knowledge of ETRI, the related party on the CDMA technology usage fees.
Asked whether Korean handset makers will be required to dole out new agreements with Qualcomm for its CDMA technology usage beyond this summer, Lee declined to give a definite answer.
``The basic spirit of the 1993 contracts was that the four Korean outfits will be freed from any CDMA-associated royalty obligation after the expiration date,’’ Lee said.
``But Qualcomm might think otherwise and I do not know whether or not the U.S. outfit is in talks with Korean handset manufacturers regarding new contracts,’’ he added.
According to data compiled by the Ministry of Information and Communication, Qualcomm has collected 3.3 trillion won ($2.63 billion) in CDMA technology fees in Korea starting 1995 until last year.
AI
