It pays to be the bearer of popular standard patents. At least that is what
InterDigital Technology Corp. (ITC) learned when it signed on seminal
Japanese electronics firm Matsushita Communications Industrial Co. Ltd. to
license its W-CDMA technology, a rival of the regular CDMA standard that is
supposed to be faster.
Matsushita plans to roll out a number of products that utilize this technology, considered
by many to be a base standard for the long-awaited third-generation (3G) of
wireless communications, under its own brand and Panasonic’s. Included will
be wireless terminals, infrastructure products and test products.
Matsushita will pay ITC an undisclosed sum in royalties for the use of its
W-CDMA technology license.
CDMA has long been spearheaded and championed by Qualcomm, which unveiled
new technologies for the standard in March at the CTIA Wireless conference. QUALCOMM raised the curtain on its
new family of CDMA Mobile Station Modem (MSM) integrated circuits and system
software: the MSM6xxx.
QUALCOMM CDMA Technologies (QCT) said it developed the family of products to
support key multimode, multiband 2G and 3G wireless technologies and to
enable true wireless global roaming.
And, very much like ITC, Qualcomm has signed on electronics makers for its
W-CDMA technology, including Samsung, which last month said it would use a
Qualcomm chip based on wideband CDMA technology to make third-generation
handsets with high-speed Internet access.
In fact, the very nonexclusivity of the deals surrounding CDMA is curious as
Matsushita signed a similar royalty and licensing deal with Qualcomm in
January. In that deal, Matsushita vowed to employ CDMA (code division
multiple access) to make modem cards for wireless devices.
After the initial royalty prepayment is exhausted through product sales,
Matsushita will pay additional recurring royalties to ITC as it sells
additional products using InterDigital’s patents.
The two firms have worked together before, with Matsushita signing a
royalty-bearing TDMA patent license with ITC in 1994. The electronics maker
is now licensed under ITC’s CDMA and TDMA patents for equipment compliant
with TDMA and CDMA-based standards.
Such partnerships are not alien to ITC, which also honors CDMA agreements
with Siemens, AT&T, Nokia and Qualcomm.
Howard Goldberg, president and chief executive officer of InterDigital, said
such deals are resultant of ITC’s broad patent portfolio.
“We are using this position to work with our industry colleagues to
encourage the proliferation of W-CDMA technologies,” Goldberg said. “With
this agreement, we are adding to our revenue base as the 3G market evolves
Goldberg & Co. aren’t the only ones looking to move into 3G. 3G, CDMA and all that goes with it got quite a buzz at the CTIA Wireless conference in Las Vegas a couple of weeks ago, as Sprint PCS, Cingular Wireless and Verizon Wireless all announced movement in that sector.
These companies vow to begin construction of 3G infrastructure and networks soon, but face challenges from the Federal Communications Commission (FCC) to better situate their spectrum. The FCC has said spectrums from telecommunications providers are too crowded for 3G services.