e.Digital Corporation (fka EDIG)

[richardosborne]

DABOSS..Now an OEM is a different story. The OEM would almost always do the total manufacturing, assume the burden of cost, and we would participate in a royalty.

The more the OEM thought they wanted this model, the more our bargaining power for the royalty amount. A tough one to call, but a minimum of $5.00 and up to perhaps $12.00. However based on the OEM marketing through various retail outlets and generating 25% gross margin at 50% of the retail amount, only gives them $44.00 before any operating expenses and royalties. I would hope with large quantities, their gross margin would be substantially higher, generating a reasonable amount for us.