Settlement with Transmeta to cost Intel $250M

連Intel也被專利問題撂倒!!!

Settlement with Transmeta to cost Intel $250M
By Colleen Taylor, Contributing Editor -- 10/24/2007
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Electronic News

The troubled IP licensing company has inked a settlement with Intel that puts an end to the companies' months-long patent war and gives Transmeta stock price a much-needed boost. By Colleen Taylor
Marking a cease fire that has given the company's financial reputation a much-needed boost, intellectual property (IP) licensing company Transmeta Corp. today announced that it has reached an agreement with industry-leading chipmaker Intel Corp. to settle all claims between them and to license the Transmeta patent portfolio to Intel for use in current and future products.
The trouble between the companies began a year ago, when Transmeta filed a lawsuit against Intel alleging the infringement of 10 Transmeta patents in October 2006. Intel denied the allegations and in January fired back by hitting Transmeta with a claim that Transmeta had infringed seven of Intel's patents.
The legal problems coincided with Transmeta's financial woes. Last year, the company reported quarter after quarter of dismal profits, and saw the resignation of its CFO Mark Kent. In January 2007, Transmeta's board voted to replace then-CEO Arthur Swift with Les Crudele in a move to head the company with an executive who had "more operational experience."
The company has been aggressively working to make changes in an effort to reverse its fiscal slump. Days after Crudele's appointment became effective, the company cut 39 percent of its workforce and launched a plan to focus entirely on intellectual property licensing in an attempt to regain profitability. In Q2, Transmeta went on with plans to cut 15 percent to 20 percent more of its staff. Despite the drastic moves and a hefty investment from Intel rival AMD Inc., change for the company's bottom line has still been slow: In its Q2 report issued in August, the company posted a net loss of $11.5 million, down from the $18.7 million loss posted in Q1.
The company's balance sheet should see some more improvements from the Intel settlement. In a statement made today, Transmeta said that their agreement provides for Intel to make an initial $150 million payment to Transmeta, as well as to pay Transmeta an annual license fee of $20 million for each of the next five years. Also, Transmeta will grant Intel a perpetual non-exclusive license to all Transmeta patents and patent applications, including any patent rights later acquired by Transmeta, now existing or as may be filed during the next 10 years.
Further, Intel has vowed not to sue Transmeta for the development and licensing to third parties of the disputed technologies.
Wall Street has given an extraordinarily enthusiastic thumbs-up to Transmeta following the Intel deal. This morning, Transmeta's stock price opened at $14.50, more than tripling yesterday's closing price of $4.18. Within the first hour of trading, Transmeta's shares hit a high of $14.98; showing strong progress from the recent past but still far from the 52-week high trading price of $26.00 the company hit last October.