OTTAWA, Ontario – February 22, 2007 - MOSAID Technologies Incorporated (TSX: MSD) today announced that it has won a competitive bid for a portfolio of essential WiFi and WiMAX patents from Agere Systems (NYSE:AGR). Under the terms of the agreement, MOSAID will pay Agere US$25 million during MOSAID's fiscal 2007 fourth quarter, US$5 million in the fiscal 2008 fourth quarter, and eight subsequent annual payments of US$5 million, creditable against Agere's 20% of royalty revenues earned under a revenue sharing formula.
"We are very pleased to have won this bid for some of the most valuable wireless patents in the world," said George Cwynar, President and Chief Executive Officer, MOSAID. "The acquisition of these wireless patents is a major step for MOSAID that firmly establishes our patent licensing program in another of the world's largest technology markets."
The portfolio consists of 20 issued patents in the United States, Japan, Germany, France, Great Britain and Canada, and three pending patents in the United States and Europe, with an average remaining life of 11 years for the key patents. The portfolio includes patents that are essential to the 802.11 family of WLAN (or WiFi) standards, and the 802.16 family of WiMAX standards. The majority of laptop computers, handheld gaming devices, video game consoles, WiFi-enabled handsets and many other wireless electronic products and systems are designed to be compliant with the 802.11 a, b, g, e and/or the 802.16 standards and would require a license to these patents.
"Agere invited more than 70 companies to bid on this portfolio of intellectual property assets, which includes several inventions patented by engineers working for the WaveLan group of NCR, which founded the 802.11 standards body," said John Lindgren, Senior Vice President Patent Licensing and General Counsel, MOSAID. "Consumer and infrastructure products that adhere to the 802.11 and 802.16 wireless networking standards utilize the patented inventions we have acquired, and many significant multinational companies are presently unlicensed to this patent portfolio."
"Agere and MOSAID have each invested considerable resources in evaluating and mapping the patents of this portfolio to the IEEE 802.11 and IEEE 802.16 standards, and MOSAID believes that the licensing revenue from these WiFi and WiMAX patents has the potential to surpass the revenues that the Company has earned to date from its DRAM memory patents," said Lindgren.
WLAN capability is expanding from use primarily in PCs and network access systems into consumer electronics such as mobile handsets and video game consoles. Over 80% of notebook computers currently include WLAN technology, and Gartner forecasts that 25% of mobile handsets will be able to connect via WLAN by 2010, a significant increase from less than 1% in 2006. The handset market continues to grow both in volume and revenue, reaching close to one billion units in 2006 (US$144 billion) and up to 1.5 billion units (US$220 billion) by 2011.
MOSAID's management will discuss the purchase of the Agere patent portfolio during the Company's fiscal 2007 third quarter analyst conference call, scheduled for 5:00 p.m. Eastern Standard Time on Thursday, February 22, 2007.
MOSAID Technologies Incorporated makes semiconductors better through the development and licensing of intellectual property. MOSAID counts many of the world's largest semiconductor companies among its customers. Founded in 1975, MOSAID is based in Ottawa, Ontario, with offices in Santa Clara, California. For more information, visit www.mosaid.com.