Qualcomm Responds to Inaccuracies in Recent Korea Times Article on Expiration of Royalty Payments
Qualcomm Incorporated (Nasdaq: QCOM), a leading developer and innovator of Code Division Multiple Access (CDMA) and other advanced wireless technologies, today reiterated its prior statement that the reports in two Korea Times articles (December 1, 2005 and May 31, 2006) indicating that certain Korean manufacturers' obligations to pay royalties to Qualcomm under their respective license agreements will expire in 2006 for sales in Korea and 2008 for exports from Korea, are not correct. The version of the Samsung-Qualcomm license agreement that the Korea Times claims to have seen is outdated and has been amended and extended several times with each manufacturer. While Qualcomm cannot disclose confidential details of its license agreements, the obligations of licensed Korean manufacturers to pay royalties to Qualcomm will continue beyond such dates (for both domestic Korean sales and exports), and there is no date on which a license under all of Qualcomm's patents becomes royalty free. While we are also not able to disclose confidential details of our joint development agreement (JDA) with ETRI, Qualcomm has previously disclosed to its investors that its sharing obligations to ETRI under the JDA do expire this fiscal year. However, the expiration of such sharing obligations under the JDA with ETRI does not in any way affect the royalty obligations of Korean manufacturers. It is unfortunate that an ETRI Director apparently has confused the terms of the JDA with ETRI with the terms of our separate license agreements with Korean manufacturers.
Qualcomm's licensing program has fostered the widespread adoption of leading-edge technologies and promoted vibrant competition throughout the wireless industry, encouraging innovation, technological advancement and vigorous price competition. Qualcomm has entered into more than 130 license agreements with the world's leading manufacturers of wireless equipment. Qualcomm is very pleased that its Korean partners have, by combining Qualcomm's patented technology with their own developments, joined a number of the Company's other licensees as world-class suppliers of CDMA equipment, as well as other technologies, throughout the world. Qualcomm looks forward to its partners' continued success.
Qualcomm Incorporated (www.qualcomm.com) is a leader in developing and delivering innovative digital wireless communications products and services based on CDMA and other advanced technologies. Headquartered in San Diego, Calif., Qualcomm is included in the S&P 500 Index and is a 2006 FORTUNE 500® company traded on The Nasdaq Stock Market® under the ticker symbol QCOM.