After coming to terms on a 10-year cross-licensing deal, speculation emerged that HTC could be paying Apple as much as $8 per smartphone shipped as part of the agreement’s terms. A little analyst math put a total payout at $280 million per year. The astonishing figure seemed a bit off, especially considering HTC’s recent financial woes. Is the company really desperate enough to make such a lopsided arrangement? Apparently not, according to CEO Peter Chou.
Chou, who HTC chairwoman Cher Wang says spearheaded talks with Apple, called such claims “outrageous” at a recent KDDI product launch in Tokyo. He said, “I think these estimates are very, very wrong…but I’m not going to comment anything on a specific number.” While the exact details of the deal are still a mystery, Chou noted that HTC considers this a “happy settlement and a good ending.”
We definitely wouldn’t consider $280 million per year a “good ending,” especially given HTC’s revenues have dropped by nearly half year-over-year. It’s not much of a surprise that Chou would deny earlier reports claiming as much. The higher brass at HTC obviously believe striking a deal afforded them the best opportunity to move on from the legal attacks of Apple. It’s also obvious they believe in keeping the particulars close to the vest for the time being.