The other way to deal with patent suits
Patient Wi-Lan shareholders were rewarded today when it was announced that Nokia had agreed to a major licencing deal. $15MM of cash up front, transfer of 93 patents, maybe long term royalties. One portfolio manager pointed out that Nokia did an early deal with NTP, and this news might suggest that Nokia has a certain pattern of behaviour: settle early and avoid the US$600MM settlements down the road.
I recently met with a guy from Intel Capital. When asked about Wimax, the only thing that he was allowed to say “Wimax was an internal project that we almost scrapped in 1999, but one engineer was very persistent. It is a good thing that we funded it because it is the cornerstone of Intel’s wireless strategy i.e. the next multi billion dollar opportunity”. I wonder how many other similar projects got scrapped at conceptual stage at IBM or elsewhere because the business case didn’t make sense at that time.
Wilan would claim to have the key patents behind OFDM needed to implement Wimax from the early 90s which despite the business case at that time now (finally) allows them to reap some benefit from patent infringements. Cisco, Redline and Nokia have settled. Another 140 companies to go according to Wilan. Intel expects to release Wimax chips in a large scale very soon, much earlier than everyone expects. That in itself perhaps represents as great of an opportunity for Wilan as it does for Intel!