Slide 1: Positioned to Capitalize on Growth in 3G Market
InterDigital November 2007 Positioned to Capitalize on Growth in 3G Market
Slide 2: Forward-looking statements
This presentation contains forward-looking statements regarding InterDigital’s current beliefs, plans and expectations as to: (i) our strategy; (ii) our future growth potential in cash flow; (iii) future global mobile device sales and market opportunities; (iv) growth in our 3G patent licensing prog
Slide 3: Shaping the Future of Digital Wireless Technologies
Shaping the Future of Digital Wireless Technologies (Gp:) Invent Wireless Technologies (Gp:) Contribute to Standards (Gp:) License Patents (Gp:) Develop Wireless Products (Gp:) 30+ Year Digital Cellular Technology Pioneer Thousands of patents worldwide Inventions used in every mobile device (Gp:) Ke
Slide 4: The Mobile Device Market Opportunity
The Mobile Device Market Opportunity Over 1.3 Billion Mobile Devices Expected to Ship by 2012 70% to be 3G Sixty Percent of 3G Mobile Devices Expected to be HSxPA by 2012 Our Goal - Secure Cash Flow On Every 3G Mobile Device Millions of units Source: Strategy Analytics, July 2007 2006 2007 2008 2009
Slide 5: Innovation Drives Patent Licensing Success
Innovation Drives Patent Licensing Success Strong Patent Portfolio - 2G/3G Cellular and Emerging Technologies 3,000+ patents issued in U.S and Worldwide Ranked # 94 among companies worldwide with patents issued from USPTO Recent Major Accomplishments LG Electronics – $285 million – new 2G/3G license
Slide 6: Solid Recurring Revenue Base
Solid Recurring Revenue Base * Excludes revenues for past sales $ in Millions (Gp:) 2006 (Gp:) 2005 (Gp:) 2007 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Recurring Royalties * $31 $33 $35 $36.20 $49.60 56.6 54.7 48.2 57.5 52.6 55.7 Tech Solutions $5 $5 $5 $4.30 $2.00 1.7 1.2 2 1 0.6 0.8
Slide 7: Strong Free Cash Flow Drives Shareholder Value
Strong Free Cash Flow* Drives Shareholder Value Solid Balance Sheet $ in Millions $ in Millions Returning Value to Shareholders & Investing in the Business * As of Sept. 30 * InterDigital defines “free cash flow” as operating cash flow less purchases of property and equipment and investments in pate
Slide 8: Leveraging Technology Portfolio to Build Value
Leveraging Technology Portfolio to Build Value 2005 2006 2007 2008 Full Modem IP General Dynamics: 3G WCDMA modem Baseband Chips 2G/3G Dual Mode baseband with HSDPA/HSUPA Integration IP Blocks NXP (formerly Philips): 3G HSDPA ASIC design Infineon: WCDMA and HSDPA protocol stack Enabling high-volume
Slide 9: Optimized Solutions for Distinct Market Segments
2G 3G / Wireless Broadband Basic Mobile Phones Feature/Smart Phones Data-Centric Devices Projected Annual Mobile Device Shipments (M units) Emerging data-centric segment exceed 400M units in 2012 Feature phones exceed 1B units and smart phones reach 250M units in 2012 Plays to our strengths in high-
Slide 10: InterDigital ASIC is Highly Competitive in Data Card Application
InterDigital ASIC is Highly Competitive in Data Card Application The 6071 baseband ASIC is optimized for the WWAN requirements of the notebook and UMPC markets (Gp:) Performance HSDPA up to 7.2 Mbps downlink HSUPA up to 1.5 Mbps uplink Highest category GPRS/EDGE performance Advanced Receiver provide
Slide 11: ASIC Specifications and Product Roadmap
ASIC Specifications and Product Roadmap Focus on Performance, Power, and Cost 6071 6072 7281 Key Specifications Package Process 389 pin BGA (12x12 mm PoP) 90nm 12 x 12 mm PoP 65nm 45nm Special low power features Hardware accelerators / voltage islands / reduced MIPS Data Speeds EDGE HSDPA HSUPA Clas
Slide 12: Future Growth Potential in Gross Margin
Future Growth Potential in Gross Margin $800 $600 $400 $200 $1.00 $1,200 $900 $600 $300 $1.50 $1,600 $1,200 $800 $400 $2.00 Annual Gross Margin Potential in 2012 ($ millions) 25% 50% 75% 100% Patent position drives market penetration Product drives value per device Today we derive cash flow on 30 -
Slide 13: Key InterDigital Takeaways
Key InterDigital Takeaways Leading Developer of Digital Wireless Technology Consistent track record of successful innovation and licensing programs with top tier OEMs Influential member of multiple standards bodies Large, diversified, and high value patent portfolio: 3,000+ patents and 9,000 applica
Slide 14: Appendix
Appendix
Slide 15: Licensees as of October 2007
Licensees as of October 2007 Alcatel Espana American Telephone and Telegraph Company (AT&T) Apple Inc. Arima Communications Corporation Danger Inc. Denso Corporation High Tech Computer (HTC) Hitachi Ltd. Hop-On Wireless, Inc. Hughes Network Systems Inc. Infineon Technologies AG Inventec Appliances C