Wave Systems Corp. (fka WAVXQ)

[dig space]

not until

First, the “Licensed Patent” aka the WaveMeter does not establish dominion over all client side consumption of digital content. There is a tendency to overstate the WaveMeter patent (although it is not as bad as the pervasive tendency to overstate the Datacasting patent and to blur the distinction between the two).

From Wave:

We hold non-exclusive patent rights relating to the metered use of encrypted data in local memory under a limited license from Titan Corporation to a patent jointly held by Titan and a third party (the "Licensed Patent"). And then blah blah blah followed by:

“We are aware of four United States patents (the "Third Party Patents") each having some claims that are similar to some of the claims in the Licensed Patent. Based upon information currently known to us, some of the claims of both the Licensed Patent and the Third Party Patents cover certain material aspects of our technology. Therefore, the commercialization of our technology would be subject to the rights of the holder of the Third Party Patents unless we are able to invalidate such claims or license such technology. Also, the holder of the Third Party Patents or a licensee of the Third Party Patents could seek to invalidate such claims of the Licensed Patent and therefore be able to commercialize a technology similar to our technology. In either case, in order to invalidate the other party's patent rights, the party claiming invalidity might need to prove that it invented the claimed subject matter prior to the other party. We cannot provide any assurance that we would be successful in invalidating such claims of the Third Party Patents or that the holder of the Third Party Patents or a licensee of the Third Party Patents would not be successful in invalidating the claims of the Licensed Patent. Furthermore, we cannot provide any assurance that the Third Party Patents could be proven to be invalid on any other basis. Any proceeding involving the validity of the Licensed Patent and the Third Party Patents would be protracted and costly. In any suit contesting the validity of a patent, the patent being contested would be entitled to a presumption of validity and the contesting party would be required to demonstrate invalidity of such patent by clear and convincing evidence.”

Voids call this paragraph boilerplate legalism. It is not (or it is that but it is more than that). The patents made under DRM and real-time clocks (both areas exploited by those other than Wave) are well funded, well claimed, and well defended. To ignore the funding, spirited litigation, and ongoing marketing of devices and technologies based on the “third party patents” and to rest so much on the increasingly hollow expectations surrounding the Titan (WaveMeter) patent is ambitious at best. To most it is simply a foolish idea. Hence there is no built-in, anticipated, or realized value of the WaveMeter patent in the trading of Wave Systems Inc Class A common stock.

The important point is, EVEN IF the WaveMeter patent covered all client-side consumption of digital content (which it does not, e.g. my use of this browser on this machine is client side consumption and Wave is not getting a penny for it) but even if it was such a carte blanc, there are others ALREADY THERE, and they have money, lawyers, products and revenues based on this space (or at least that component of the space that voids so frequently and errantly ascribed to Wave).

Your Friend,

Dig Space.