InterDigital Inc (IDCC)

[rmarchma]

TFWG re estimated wholesale price of 3G handsets

I am using $500, not $600, as the estimated wholesale price of dual-mode 3G handsets from NEC. I based this estimate upon an article that I read, but I don't have the article saved. I was initially using an estimated handset royalty rate of 1.5% or $7.50 per handset. I believe that 1.5% is the royalty rate for NEC's infrastructure, and I think that they may be paying a blended 1.5% rate for all 3G products, both infrastructure and handsets. However, NEC's 3G contract does have an unknown royalty cap per handset. I felt a little uncomfortable using a $7.50 royalty per handset for projection purposes, which might be capped before that amount anyway, so I scaled it back to a more conservative $6 per handset.