Royal Philips Electronics and major optical disc manufacturers in Taiwan
are negotiating new royalty charges for using CD-R patents owned by
Philips, with a consensus not being expected till the end of June at the
earliest, according to DigiTimes.com.
Philips currently imposes royalty charges of US$0.045 per CD-R disc and
US$0.06 per DVD+R disc on Taiwanese licensees. As the OEM price for CD-Rs
has dropped to US$0.15-0.2 per disc, royalty payments have risen to
22.5%-30% of revenues.
In addition to the drop in CD-R pricing, other factors lead Taiwanese
makers to expect Philips to lower its royalty charges. On March 11, a US
International Trade Commission’s (ITC) final judgment ruled against Philips
in a case where the company accused two Taiwanese optical disc makers of
patent infringement. Also, Japanese companies including Sony, Taiyo Yuden
and others have offered lower royalty charges for Taiwanese makers.