Wi-LAN’s (TSX:WIN) patent settlement with BlackBerry is a minor positive for the Ottawa-based patent player the real show is about to begin, says Cantor Fitzgerald analyst Justin Kew.
This morning, Wi-LAN announced it had reached an agreement to dismiss all pending patent litigations between the two Canadian companies. For BlackBerry, the settlement was their second this week, having come to an agreement with Kik Interactive over its instant messaging app yesterday.
Kew says Wi-LAN’s agreement will mean lower overall litigation cost and more licensing revenue for Wi-LAN, although he believes the agreement is a modest one.
What isn’t modest, says the Cantor Fitzgerald analyst, is Wi-LAN’s upcoming actions. Kew says the major catalyst for Wi-LAN right now is its handset case against Apple, which is scheduled to begin October 15th. He believes that a settlement with the Cupertino-based tech giant could be as impactful as Wi-LAN’s expanded agreement with Samsung, which he estimates to be worth $15 to $30-million per year.
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Kew says Wi-LAN’s litigation calender for 2013 is beginning to look like a success, he notes that the company settled with HTC in mid-September, a deal he thinks is worth between $2 to $3-million annually. Wi-LAN has also settled with Dell, which he believes was small but important as the deal signaled the strength of Wi-LAN’s position to other defendants.
In a research update to clients this morning, Kew reiterated his BUY recommendation and $6.00 target price on Wi-LAN.