I note that the longs are completely ignoring the real issue here.
Any analysis of ParkerVision’s case against Qualcomm concludes in something like X% probability of winning a $YM judgment (it’s actually a probability distribution, but that lowers the numbers…)
We can argue endlessly about X (I think it well under 30%, you obviously think it higher), but the issue are technical and hard for a non-RF person to understand.
The judgment size range is *not* complicated. The Ladenburg Thalmann report uses damages based on worldwide sales of Qualcomm’s baseband chips. This is easily verified to be wrong on both counts. The correct (worst case) damages would be based on U.S. sales of transceiver chips. Qualcomm sells between 100M-150M transceiver chips per year in the U.S. (indirectly, built into wireless handsets, etc.) Transceivers cost $2-$6 each with an average ASP of roughly $4 (compared to baseband chips of $20 and up, ASP above $25). Thus the best case for PRKR is they win every issue in this case and they get damages of somewhere between $6M-$30M per year of allowed sales (implied royalty of 1%-5%). This is under $70M if laches applies, and under $120M if it doesn’t – worst case – the likely number is *much* less. There are equally good, non-infringing alternatives (active mixers, which QCOM’s competitors are using), and QCOM can switch back if they need to – so that the future royalties will be smaller than awarded damages.
So what is the NPV of a 30% chance of winning roughly $100M in damages plus royalties, and which will never actually be paid due to appeals? Even if I use a higher number than 30%, I can’t even come close to justifying the current market cap.
Wait a minute - wait a minute - I thought you guys said that Parkervision's technology didn't work. That's why you keep citing those communications from Qualcomm's engineers back in 1999 that said that Parkervision's technology either didn't work or wasn't worth it. That's why you also argue that all the other companies that looked at PV's technology walked away.
Well - if it doesn't work, Qualcomm should have nothing to worry about. Why fight so hard on a patent infringement case if the stuff doesn't work. Certainly, Qualcomm is not using a technology that doesn't work - so how could it infringe on patents for a technology that simply does not work?
Moreover, why work so hard producing "invalidating" prior art if the Parkervision's patents are worthless?
On the contrary, it seems that the arguments that Qualcomm is making in this lawsuit assume that the technology in fact works and has value. Hummel's arguments are basically that Parkervision fraudulently obtained patents on technology that was already in the marketplace - that it just took existing technology, and slapped new terms on them .Well- if that's the case, then the Parkervision technology - whether Parkervision invented it or somebosy before it invented it - works.
You can't have it both ways - either the stuff doesn't work - in which caseQualcomm has nothing to worry about - or it does work -in which case Qualcomm apparently does have something to worry about.
Sentiment: Strong Buy
: I thought you guys said that Parkervision's technology didn't work.
Asked and answered many times (most recently in the last month), as you know.
I have been very consistent over the last 7 or 8 years that D2D "works" but is not new, while D2P doesn't work at all. Only D2D is in the paent case. Every post I've made here or on pvnotes is consistent with this.
Here's two - there's lots more (taken verbatim from earlier Yahoo posts). Split over two messages for size.
: Who else, besides Parkervision, has a technology converts A to D without mixing two waves together
No one, of course. But then Parkervision D2D does, in fact, use a mixer. You clearly haven't read any of the D2D patents, as all of the patents clearly describe a direct conversion receiver, where the RF signal is *mixed* with a constant reference frequency which directly converts the signal to baseband (i.e. DC offset). This is the same as every single other direct conversion receiver ever built, including the 100's of millions of receivers per year currently being built by Broadcom and Atheros.
I finally got around to looking over information on your website: A read of Steve Cripps analysis is good imo. Towards the end Steve talks about methods used in current wireless systems, how digital processing methods (DSP) can be used to pre-distort/condition/'whiten' signals to reduce non-linarities and increase net efficiency.. however the entire method must be figured into the power consumption equation. LTE system are pursuing advances in signal condition that make use of more active signal measurement and estimation so that an integrated systems approach can be used that includes sub-channel OFDMA amplitude modulation and selectivity. The processing is on an evolutionary path: while it consumes power and has an impact on signaling overhead as well, the over-sampling and higher order modulation techniques are being used as chips evolve to higher density and lower power. It can be said that the field of wireless is becoming 'adaptive' at every level of the overall device and network system. For example, the first way to reduce power consumption is to increase SINR, signal to nose ratio. There are multiple ways to achieve that including use of MIMO, CoMP, and simple using more but smaller cells so signals don't have to be powered as highly by mobile devices. Co-MIMO/MU-MIMO is starting to appear commercially in which a SU might receive signals from two or more small cells and BS. I point that out because the approach taken is using more processing that Cripps refers to to achieve the desired results... while gains seen in PAs/RF sections are developing by active impedence matching and other methods rather than novelty inventions in power architecture itself.
PV is likely to lose.. however, its up to judges and juries so nothing is for certain.
Nice reasoning. Even if the assertion of double-treble damages were ruled, which is seldom awarded and almost always appealed and overturned, the damages apply within the US market for the infringed sales, not for broad sales.
A reality check is is to look at licensors of current 3G-4G wireless patent portfolios including Interdigital and WiLAN. Both of these companies have large portfolios of patents for which they have paying agreements and wins in court battles and subsequent settlements for patents used in Wi-Fi, 3G, 4G and additional technologies. The history of legal battles is sufficient to get a fair understanding of the range of awards... even though the royalty rates are seldom disclosed.
A simple way to understand what is likely is to view the numbers of patents, agreements/settlements, and revenues: the aggregate revenues of these proven technology companies are less than is suggested for PRKR. Both of these companies have patents on technologies used in the baseband chips. Although royalty rates derived from known numbers of unit sales and dissection of revenues, I figure the rate is between 0.5% and 1% for court upheld patent claims of the aggregated multiple patents. The higher end of the ballpark licensing rate of 1%-5% is seldom, if ever, met in the wireless chips business imo. As I can determine, the only time that might be the case is for licensing of the largest patent portfolios held by Qualcomm and Ericsson and declining from there... with new shifts occurring with Apple, Google and others fights over device design, applications, and business method patents that apply across the much larger device rather than component sales. The rates for licensing across SmartPhones and other devices will probably be another five years to settle out before it can be judged to be within or outside of established norms. Usually, the initial 'wins' are greatly reduced, the more so to a degree that the end product is a commodity used in end products.
I don't care about appeals. I should be long gone and shorts like Mike Farmwald should be bankrupt if ParkerVision wins in court and before they can possibly lose on appeal.
Have you ever been paid for services rendered to Qualcomm or rendered to agents of Qualcomm?
The Big Issue is not one lawsuit, but rather the perceived prospects of the company. A few months before Rambus hit its 2006 2nd peak at 12x PRKR's current market cap it had $160 million in cash and about $250 million in tangible book.
Given PV's tax-loss carry forward, PV could be in the same position by netting about $300 million after legal fees.
The Big Issue is therefore that whatever happens in this lawsuit is not going to be in a vacuum; nor will it be controlled by people who have been familiar with PRKR and all its prior missteps and problems.
With $250 million in the bank, PV will be creating a lot of excitement: whether real, or, as RMBS turned out to be, imagined, but with 270 engineers (like RMBS in 2005) and any CEO they want, building whatever they want and making all kinds of other headlines too (like more litigation, including international) the stock won't care.
Your "Big Issue" is a Big Straw Man: That PV has to win billions to have a $4 billion mkt cap, exactly as RMBS did circa 2006. And, if unlike Scambus, they happen to have something real and valuable, well, then, watch out world