Qualcomm Preaches Comparative IPR Rate of CDMA Standard for IMT-2000

Article excerpt

Qualcomm Inc., a San Diego-based CDMA (code division multiple access) solutions provider, yesterday urged the Korean government and mobile phone carriers to embrace CDMA for IMT-2000, citing the lower royalty rate.

At a press conference, Louis M. Lupin, senior vice president and proprietary rights counsel of Qualcomm, said the total royalty cost for multi-carrier IMT-2000, an upgrade from today's CDMA will be ``very reasonable.''

``Qualcomm expects the total royalty cost for multi-carrier should be lower, especially compared with direct spread,'' Lupin said.

Multi-carrier IMT-2000 is led by Qualcomm, while direct spread type of the third-generation (3G) mobile system is based on GSM mode which dominates the European mobile market.

Lupin emphasized that Qualcomm has in its power to protect Korean manufacturers and service providers in maintaining IPR (intellectual property right) fees for IMT-2000 while it cannot guarantee such favorable conditions for European direct spread mode.

He noted that Qualcomm is powered to control the overall IPR rate in concert with a few patent holders, which will benefit Korean players once they opt for multi-carrier type in choosing the forthcoming IMT-2000 license.

``The situation for direct spread is very different. At least 27 companies have already stated publicly that they have essential patent,'' Lupin said, suggesting that the ``chaotic'' situation will hike the royalty rate for Korean operators and manufacturers.

To streamline and create a unified voice for direct spread IMT-2000 IPR, the patent holders are in the process of forming ``patent platform.''

According to Lupin, however, the platform is not working largely because most of the important patent holders such as Ericsson, Nokia and Motorola do not join the group.

``As a consequence, the royalty rate for direct spread is likely to be very high,'' Lupin argued.

Asked on whether Qualcomm is willing to lower the royalty rate for Korean players, Lupin said it is still premature to discuss the issue.

Qualcomm has long been mired in the royalty dispute here since Korean manufacturers often complained Qualcomm did not reciprocate the huge revenues coming from Korea's fast-growing CDMA market by lowering the royalty rate.

Currently, Qualcomm is maintaining the royalty relations with 25 Korean licensees, many of which allegedly took issue with the unfairly high royalty.

Lupin stuck to NCND (neither confirm nor deny) policy when asked on the specific rate of CDMA royalties applied to Korean manufacturers but it's a sort of open secret that the rate is 5.25 percent.

``We haven't heard the royalty rate was unfair here. …