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Message: MIKE3691 / Re: MMP License Fees & PTSC Shares Repurchased -BaNosser

The best example I can think of that explains the values I'm using in the spreadsheet that BaNosser posted is that of a car maker that makes one model and sells 100,000 of these cars a year. Suppose the car has a component in it with 10 microprossessors that infringe that have a value of $500 of the total $50,000 that the car sells for.

Does TPL/PTSC get to collect a royalty percentage on the $50,000, ($49,500 of which has nothing to do with the microprossers with infringing technology), or do they get a percentage of the $500 value of the components that infringe.

In my example, the car maker has annual revenues of $5B but only $50M of that is attributable to the MMP infringing tech. So if TPL/PTSC gets $1 in licensing fees for every $2000 in gross revenues the company makes (that equals a royalty rate of .05%), it would get a license fee of $25M. However, if you compare that $2.5M but if you compare that as a percentage of the gross revenues attributable to the MMP infringing tech, that's $2.5M/$50M, which is a royalty rate of 5%.

IMO, you have to look at the list with that in mind. While the companies may have large annual revenues, that revenue is attributable to much more than just the MMP infringing tech that some of their products contain.

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Jan 26, 2008 03:13PM
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