olddog - you are absolutely correct, and that is one aspect of the idea I was attempting to communicate. If Nokia allows the ICC Court of Arbitration to set their rates on 2G from Jan 1, 2002 forward,... THEY are going to be "locked in" to paying those rates, and INTERDIGITAL will be "locked in" to reporting those payments as accounting rules require.
Step back from the table and turn around three times because this old retired deal maker is about to whip up another "magic potion". LOL! Let's keep it real simple and just talk about IPR usage rates. IMO IPR usage rates are fully negotiable between Nokia and InterDigital up until the ICC Arbitration Court delivers their Final Judgment rulings on Nokia's 2G rates sometime before June 1, 2005.
The 2G rate negotiation landscape(and the accounting picture for revenues generated by those rates) will change after that happens. But until then, the two parties are free to negotiate 2G rates any way they are comfortable explaining. Guess the point I'm attempting to make is that rates for IPR usage are one thing,... while the accounting of payments generated by those rates is something else. One is flexible while the other is not.
Lets get specific. IMO Nokia and InterDigital could agree that the "valid and infringed" IDCC 2G IPR practiced in products Nokia sold from say Jan 1, 2002 up through Dec 31, 2004 was "only" worth .25% of wholesale, while all of the "new" 2G IPR added to InterDigital's 2G portfolio by that date made their contributions worth lets say .5% from then forward.
I know, "Yikes!" what about all of the MFL provisions and the rates agreed with SONY/Ericsson? Well, seems like the really big 2G players are all in the same boat with Nokia when it comes to settling up on 2G before licensing for 3G with InterDigital. Big numbers to swallow whole.
Also have to consider the fact that InterDigital has already set their "pre-2002 rate floor" on 2G. We saw that first with the 1999 Nokia settlement(i.e., $31 Million for a ga-zillion 2G products sold before Jan 1, 2002 with 2G rates after that to be "triggered" by a "named manufacturer"), and then again in the 2003 settlement with Ericsson. Key point is that whatever that painfully cheap pre-2002 2G rate was, InterDigital introduced some HIGHER 2G rates for conforming products sold from Jan 1, 2002 forward.
What's to say that InterDigital's 2G rate structure cannot have a SECOND step up now that we already know about that first step? Nokia, Motorola, Seimens, and Samsung are all still in play for whatever 2G rate structure InterDigital can get established, and collectively they sold a lot more 2G products than everybody else combined. My play would be to cut the best deal I could with THOSE guys, and let the rest fall into place.
AI
