Royalty Rate
I tried to cut and paste but it didn't work well.....this is from an old Union report I'm sure most have seen before. Routhier always talks about the business model being "validated"; and the model would work well with a $1.50 unit royalty rate if they get reasonable market penetration. Talk about delays, staffing issues whatever...at the end it all comes down to $$ and this is why the stock has tanked and why Sprott is selling. At 25 or 50 cents cents it simply doesn't work, I don't care how many 3d tvs are sold. I believe that with 3d content and the Autodetect the market penetration will come...but unless the rate is much higher than 25 - 50 cents, the revenues will never amount to much. The key question is: Are the royalty rates tied to sales volumes....why can't Routhier give a simple yes or no to this question?
We expect Sensio will receive between $1.00 - $5.00 per unit in
royalty revenues depending on sales volume
Industry research firm iSuppli, estimates HDTV shipments to reach
approximately 250 mm units by 2012 from 100 million units currently and IDC
forecasts total PC shipments of approximately 450 mm units worldwide by 2012.
If we assume 25% of all HDTV and PC units will be 3D compatible and assume
royalty revenues per unit of between US$1.25 – US$6.00, we forecast an
addressable market opportunity of US$210 mm – US$ 1.1 bn per year. Assuming
a modest 10% - 15% market share and a $1.50 royalty per unit, we estimate