WILMINGTON II
QUESTIONS AND ANSWERS:
WEBCAST ?
Companies not under license.
Bill Merritt –
Larry Shay has a deep pipeline as soon as they ship product, he will go get them.
Shareholder ?
Patent Trolls –Lot of public discussion – how do the courts see it?
Bill Merritt –
We are different – just look at our R&D and licensing history. This is a record that cannot be ignored when courts are looking at individual companies.
When companies license – how many do they typically use out of 20,000 patents?
Bill Merritt –
9 – 10 thousand have been declared to standards bodies. So quite a few are licensed.
More than 3 or 4?
BM- YES
QUESTION -
Arbitration and Litigation Update
Bill Merritt –
We only go to arbitration and litigation when we believe we have a very strong case.
QUESTION –
Are you nervous or squirming or are he other parties about June 28?
Larry Shay –
We are not squirming.
WEBCAST QUESTION –
What about the use of cash?
Terry Clontz –
Free cash flow is the most important measure for shareholders. Management needs x amount to keep the company healthy and growing. Beyond that, we return money to the shareholders in a way that makes sense through the use of buybacks, dividends, special dividends, and share price increases.
SHAREHOLDER QUESTION – SONY AND RIMM Fixed vs. running revenues per unit
Bill Merritt –
We look at the projected cost of sales as presented by a third party, IDCC intelligence and sometimes the other company itself. Then we do a discounted cash flow to the present to get the value and then make a decision. We don’t favor fixed vs. running revenues one over the other but we think to do what makes the most sense in each situation. We used to give large discounts for prepayments but we do not do that as much anymore because of the economic strength of our company.
QUESTION – APPLE NEGOTIATIONS IN 2014 –
Bill Merritt –
This is an important license opportunity for IDCC. We have had and are having direct conversations with APPLE. Court decisions in the past and the one coming up on June 28, if in our favor, will help a great deal. With all of our execution we have positioned ourselves very well for the negotiations with APPLE.
QUESTION –
DEWITT CAPITAL 200,000 + shares
Is Pegatron a way of licensing APPLE?
Bill Merritt –
Yes.
What about compression technology?
This will be very, very important to our growth. It will reduce band width by over 50% through multiple facets – proprietary IP plus standards plus ?
Court systems in politics –
Do we lobby?
Bill Merritt –
Yes, we have enhanced it with other companies who share our views, as well as, people in academic institutions who share our view. I talk to trade magazines and this is a muti pronged approach to shape the dialogue.
Terry Clontz –
We are always trying to mitigate the risk.
SAM -
When will we get revenue from it?
Allen Prothis –
May be on a fixed or per unit basis and may also be affected by customization. Mobile operators will be the target as they will benefit the most.
WEBCAST QUESTION –
Litigation expense –
Bill Merritt –
It is up because of the high level of activity. It is a very important investment for our company. Expenses are driven by both sides in the dispute. We do what we have to do which is an expense but we also have to respond to what the other side does which adds to our expenses. We are not a litigious company. We have only sued 6 companies in our history.
Our law firms are the best in the business.
THANKS TO MY WIFE ELIZABETH FOR TAKING MY DICTATION TO FACILITATE THESE POSTS!
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