DVD6C Announces Royalty Reduction for DVD Decoder and DVD Encoder

Thursday, September 4th, 2008 

The DVD6C Licensing Group (DVD6C) consisting of nine leading developers of DVD technology and formats — Hitachi, Ltd., Matsushita Electric Industrial Co., Ltd. (Panasonic), Mitsubishi Electric Corporation, Samsung Electronics Co., Ltd., Sanyo Electric Co., Ltd., Sharp Corporation, Toshiba Corporation, Victor Company of Japan, Ltd. (JVC) and Warner Bros. Home Entertainment Inc. — today announced that it has revised its worldwide patent licensing program beginning on and after July 1, 2008, including offering a new license agreement (the “New DVD6C License”), which offers the following reduced royalty rates on DVD Decoder and DVD Encoder, respectively.

The DVD6C’s patent royalty for DVD Decoder is the greater of 4% of the Net Selling Price of the DVD Decoder or US$1.00 per decoder sold on or before the effective date of the New DVD6C License, and the new royalty rate will be US$0.50 per decoder on or after the effective date of the New DVD6C License.

Similarly, the DVD6C’s patent royalty for DVD Encoder is the greater of 4% of the Net Selling Price of the DVD Encoder or US$1.50 per encoder sold on or before the effective date of the New DVD6C License, and the new royalty rate will be US$0.75 per encoder on or after the effective date of the New DVD6C License.

Interested parties will remain free to negotiate individual license agreements with DVD6C’s member companies, rather than taking out a single portfolio license or license for a category of products. The member companies have committed to provide such licenses under fair, reasonable and non-discriminatory terms and conditions.

For the convenience of current and prospective licensees, the royalty rates to be offered under the new DVD6C License are shown below:

Category Royalty
DVD Decoder
(Newly revised)
The greater of
(i) 4% of the net selling price or
(ii) US$1.00 per decoder
US$0.50 per decoder on or after the effective date of the New DVD6C License
DVD Encoder
(Newly revised)
The greater of
(i) 4% of the net selling price or
(ii) US$1.50 per decoder
US$0.75 per encoder on or after the effective date of the New DVD6C License
DVD-Video Player The greater of
(i) 4% of the net selling price or
(ii) US$4.00 per player or,
     US$3.00 per player on or after the effective date of the New DVD6C License
US$8.00 at maximum on or after January 1, 2003
DVD-Audio Player The greater of
(i) 4% of the net selling price or
(ii) US$4.00 per player or,
     US$3.00 per player on or after the effective date of the New DVD6C License
US$8.00 at maximum on or after January 1, 2003
DVD-ROM Drive The greater of
(i) 4% of the net selling price or
(ii) US$4.00 per drive or,
     US$3.00 per drive on or after the effective date of the New DVD6C License
US$8.00 at maximum on or after January 1, 2003
DVD-ROM Disc US$0.075 per disc;
US$0.065 per disc on or after January 1, 2002;
US$0.05 per disc on or after January 1, 2004;
US$0.040 per disc on or after the effective date of the New DVD6C License
DVD-Video Disc US$0.075 per disc;
US$0.065 per disc on or after January 1, 2002;
US$0.05 per disc on or after January 1, 2004;
US$0.040 per disc on or after the effective date of the New DVD6C License
DVD-Audio Disc US$0.075 per disc;
US$0.05 per disc on or after January 1, 2004;
US$0.040 per disc on or after the effective date of the New DVD6C License
DVD Video Recorder The greater of
(i) 4% of the net selling price or
(ii) US$6.00 per recorder
DVD (Recordable Disc) Drive The greater of
(i) 4% of the net selling price or >br>
(ii) US$6.00 per drive
DVD-R Disc The greater of
(i) 4% of the net selling price or
(ii) US$0.075 per disc;
US$0.045 per disc on or after January 1, 2006
DVD-RW Disc The greater of
(i) 4% of the net selling price or
(ii) US$0.075 per disc or,
US$0.065 per disc on or after the effective date of the New DVD6C License
DVD-RAM Disc The greater of
(i) 4% of the net selling price or
(ii) US$0.075 per disc or,
US$0.065 per disc on or after the effective date of the New DVD6C License
Recordable Disc Case The greater of
(i) 4% of the net selling price or
(ii) US¢0.5 per case
+R Disc The greater of
(i) 4% of the net selling price or
(ii) US$0.075 per disc, or
US$0.045 per disc on or after January 1, 2006
+RW Disc The greater of
(i) 4% of the net selling price or
(ii) US$0.075 per disc or,
US$0.065 per disc on or after the effective date of the New DVD6C License

For further information regarding the DVD6C licensing program, please visit the 6C web site.