WiMAX equipment vendors should begin now to factor royalties into their planning and pricing activities, according to ABI Research. The firm's newly launched "Mobile Broadband Research Service" pinpoints a potential ongoing cost that is being widely ignored by the WiMAX industry, with one notable exception.

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Qualcomm has long been collecting royalties for its CDMA technology, and more recently for WCDMA as well. The company's pricing structure has led to a perception among some licensees that Qualcomm is focused on making royalties its primary revenue stream. Senior analyst Philip Solis of ABI Research's wireless connectivity practice says that is not the case, citing figures showing that IPR currently accounts for less than one-third of the company's revenues.

One WiMAX-oriented company, Soma Networks, has clearly been paying attention. Soma licensed Qualcomm's CDMA IPR in 2001, and announced last month that it had signed worldwide subscriber and infrastructure license agreements with the company, allowing it to develop, manufacture and sell OFDM/OFDMA subscriber units, modem cards and infrastructure equipment. This was the first such WiMAX-related royalty agreement concluded by Qualcomm.