Nortel 4G IPR no where near $2.9 billion
Posted Wed, 1 Jul 2009 04:01:03 EDT by Stuart Carlaw
JP Morgan were cited in Lightreading http://www.lightreading.com/document.asp?doc_id=178671 regarding Nortel's IPR and stated that the Nortel 4G IPR holding could be worth up to $2.9 billion.
This is definitely a good story and might be good to attract more potential bidders for Nortel's wireless assets, however, it is based on the assumption that they will get a royalty rate of 1% of every LTE device sold. This is disproportionate to their patent holdings and cannot be seen as fair and reasonable. I doubt any other single vendor will be looking for this type of return - even Qualcomm.
Qualcomm will bundle LTE with other technolgies in a uber licensing package which will mean that the LTE portion is actually much less than their cumulative royalty rate which is between 2-3% for all technologies.
So in conclusion - good story but highly unlikely.