Answers we need from IDCC
Many are cheering the big win, but we don't yet know if it was a win (like the LG deal) or a buckle (like the settlement with Ericsson). We have a "binding term sheet" with Samsung. Is that anything like "binding arbitration" with them?
Mr. Merritt said "The agreement is consistent with our long term strategic plan, and reflects well on the strength of our patent portfolio and our ability to design flexible deal structures." If he was referring to getting $1 - $2 a unit for 3G, then I am absolutely thrilled with the agreement even if it includes giving away some hard earned 2G monies. I sincerely hope the long term strategic plan is not to settle for whatever they can get whenever decisions on patents are about to be announced.
For the risk adverse, this takes away much of the downside risk, but the cost is getting full value on the patents. Until we know the terms, this investor is still undecided on whether the deal is a good one. It seems that I'm the lone holdout.
For those of you who want to chide me for being so negative, please include what you think is a good deal or a bad deal. I remember after Ericsson, those that were the most strident that IDCC would get hundreds of millions were the loudest supporters of what I thought and still think was a poor result. So let's here what you think before the facts are known.
Here's my view:
Poor is anything under 40 cents a unit - should not have settled.
40 cents to 80 cents is fair to good.
80 cents to 1.50 is good to incredible.
The above ranges are increased by 10 cents if we don't get paid for 2006, another 15 cents if we don't get paid for 2007, and penny for every $10 million reduction to the $180 million we are owed for 2G.
