“We are the guardians of the future” defended InterDigital CTO Henry Tirri, in response to Faultline’s criticism of his company’s distinct lack of PR presence relating to the Technicolor R&I assets acquired last year.
In all fairness, we told InterDigital that lying low was fair game for a company with such a patent-heavy business model. Still though, we were not in agreement.
The cellular technology specialist completed the acquisition of Technicolor’s visual technology research division in July last year, along with some 30,000 patents and a prolific engineering workforce. Naturally, we were chomping at the bit to get our teeth into something juicy soon to emerge from a business which InterDigital itself told us it could run more proficiently than Technicolor (a statement which Technicolor actually agreed with).
So, Tirri – who also serves as EVP of R&D at InterDigital – proceeded to reel off a list off every buzzword imaginable – listing projects in mixed reality, synthetic overlay, artificial intelligence, machine learning, machine-to-machine compression, cloud gaming and edge computing, to name but a few. While not the meaty specific we were after, it shows just how broad-reaching InterDigital’s R&D engine is – and that’s excluding the core wireless sector.
Eventually, with a little encouragement, Tirri narrowed down his scope to a few key visual projects. One ripening fruit on the InterDigital visual roadmap is creating high-quality, 3D volumetric compression techniques for industries like film, gaming and – interestingly – automotive.
Since completing the acquisition of Technicolor assets, InterDigital has continued to work closely with Technicolor in competency and research. Of course, Technicolor still has a production business which comes in handy.
Mobile ray tracing for gaming is another frontier for InterDigital’s visual software department. This takes traditional 3D scenes or objects and extrapolates data to calculate how light will fall and how ending colors will look and feel. With real-time ray tracing capabilities, each pixel can receive accurate light coloring – greatly advancing the realism of 3D images.
Ray racing is a technology we have come to associate with UK-based Imagination Technologies through its PowerVR technology, which has caught the eye of Apple no less. Imagination said it would open up this intellectual property last year to companies exploring emerging 5G applications requiring high-quality graphics rendering with realistic light and shade effects. Reducing the compute power of these traditionally highly-intensive processes to support mobile applications has been achieved by Imagination and now InterDigital.
InterDigital was due to demonstrate visual technologies alongside its core wireless clout for the first time at Mobile World Congress next week, until Coronavirus scuppered that idea. InterDigital is now seeking alternative arrangements for this video-wireless R&I convergence debut – most likely at home in France but potentially in London, we are told. NAB in April will be our first glimpse.
On the topic of MWC, when Faultline last spoke with InterDigital in Barcelona last year, the company exuded an aura of being unfazed by uptake of the royalty free codec AV1. A year later and with the likes of Netflix adopting AV1, we were unsurprised to hear that InterDigital’s stance has hardly changed. “MPEG is not going anywhere anytime soon,” stressed Tirri.
InterDigital took a big step towards transparency a couple of weeks ago by publishing its IPR pricing structure. The example provided by InterDigital is that the company makes $1.15 in licensing fees from every $500 smartphone that implements 3G and 4G standards, as well as WiFi and HEVC video technologies.
Approximately $0.10 of this – or 8.7% – comes from licensing HEVC patents on mobile, we were informed this week by InterDigital CCO Patrick Van de Wille, who was also present on the call. “Most of these numbers were already out there so we thought we might as well make it all available, which required a fair bit of legal scrubbing,” according to Van de Wille, adding that increasing calls for transparency from regulators was another influencing factor.
Asked if this was essentially a trust exercise and whether InterDigital expects the reveal to provoke others to follow suit, the short answer is yes.
The new video technology business brought in InterDigital $4.9 million from video licensing during Q2 2019. Total fourth quarter 2019 revenue came in at $102.2 million—up from $75.3 million a year earlier.
InterDigital secured Japanese TV maker Funai as a new licensee in the fourth quarter, making InterDigital’s video division a $20 million a year annual revenue business. Funai manufactures TV sets under the brands Magnavox and Sanyo, among others.
Net income for the quarter soared to $13.8 million, from $2.1 million in Q4 2018, on the back of lucrative wireless deals at Google and ZTE.
A new license was also secured on the consumer electronics side, which InterDigital is aiming to build into an annual licensing business of $150 million in the region of 3 to 5 years.