InterDigital inks license deal with Apple
BANGALORE (Reuters) - Wireless technology firm InterDigital Inc (IDCC.O) said it signed a seven-year licensing agreement to provide technology for Apple Inc's (AAPL.O) first cell phone, the iPhone.
Separately, InterDigital raised its third-quarter revenue outlook range to $55.5 million to $56.5 million from its prior view of $53.5 million to $54.5 million.
The King of Prussia, Pennsylvania-based company did not say how much it expects from the deal but an analyst said he estimated it to be worth about $56 million over the duration of the deal.
"They are going to be getting $2 million a quarter for the next seven years," Boenning & Scattergood analyst Michael Ciarmoli said by phone.
According to a regulatory filing, InterDigital's license agreement with Apple covers the current iPhone and certain future mobile phones, if any.
"The deal covers various 2G and 3G cellular technologies encompassing bandwidth allocation, roaming and power efficiency controls, and most likely also includes some type of packet data coding and delivery," Ciarmoli said.
In its statement, InterDigital said it expects to receive a $20 million payment in the near future in connection with a recently signed license agreement. Revenue associated with the agreement was reflected in its new guidance, the company said.
However, when reached for comment, a company spokesman would not confirm if the money was coming from the Apple deal.
Shares of InterDigital were trading up $2.76 at $23.97 in afternoon trade on the Nasdaq. They rose as high as $24.69 in midday trade.
InterDigital is also involved in a patent dispute with Nokia over third-generation technology. The U.S. International Trade Commission is expected to start an investigation of certain Nokia (NOK1V.HE) 3G mobile phones based on a complaint filed by InterDigital last month.
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