1999-09-22 , S/IC-2070/34
Business News From Philips Semiconductors

Exclusive agreement allows Philips Semiconductors to develop, modify, make and sell W-OFDM application specific integrated circuits for the emerging IEEE802.11a standard

Wi-LAN Inc. (ASE:WIN), a leading innovator in the growing wireless Internet/data communications sector and Philips Semiconductors today announced the signing of a definitive licensing agreement.

Under terms of the agreement, Wi-LAN ( www.wi-lan.com) will share its W-OFDM technology and expertise with Philips Semiconductors for a one-time licensing fee and future royalty payments based upon the volume of integrated circuits shipped. Additionally, Philips Semiconductors receives one year of exclusive access for their own use to Wi-LAN's W-OFDM intellectual property for the large volume consumer electronics market. Terms of deal will not restrict Wi-LAN from licensing its patent to companies not directly competing with Philips Semiconductors. During the same period, Philips Semiconductors will not develop products using wireless W-OFDM technology with any other party than Wi-LAN. Due to the competitive nature of the industry, financial terms of the deal will not be disclosed.

In July 1998, the Institute of Electrical and Electronics Engineering (IEEE) selected OFDM technology as the draft standard - 802.11a - for Local Area Network applications. In response to this draft standard, Wi-LAN agreed to license its patented W-OFDM technology to a variety of interested parties including chipmakers and equipment manufacturers. W-OFDM is Wi-LANs variation of OFDM that further improves its characteristics, including allowing greater transmission speeds. Today's announcement marks the first license agreement of W-OFDM technology for the emerging IEEE 802.11a standard. Furthermore, this license agreement is the first step towards the manufacturing of low cost W-OFDM products.

"Our first patent licensing and development agreement is a major step for our company," said Dr. Hatim Zaghloul, President and CEO of Wi-LAN Inc. "Wi-LAN has needed a larger partner that can help it in the production of integrated circuits. These integrated circuits could help in realizing our goal of seeing W-OFDM in every high-speed communications device.

"With this agreement, Wi-LAN receives semiconductor chips as well as revenue from the consumer electronic market. We are excited to be working closely with Philips Semiconductors for their technological leadership, vertical integration and market penetration."

Both companies will collaborate on developing proprietary W-OFDM integrated circuits based on Wi-LAN's I.WiLL™ product, which was unveiled by the company in June of this year. Through this collaboration Wi-LAN and Philips Semiconductors look to lower the cost of the customer premise equipment, currently in final development stages at Wi-LAN. Additionally, the companies will collaborate on building integrated circuits around the IEEE 802.11a standard. Philips will use the circuits for its consumer electronics products while Wi-LAN will use it for its Internet wireless local loop business. The chips will also be available for sale to interested companies. Both Wi-LAN and Philips Semiconductors agreed to work together to further drive standards based on W-OFDM.

"This agreement cements a multifaceted working relationship with Wi-LAN to support our efforts in the wireless arena," said Phil Pollok, vice president of the Business Line Interconnectivity Philips Semiconductors. "The integration of Wi-LAN technology represents an important step in bringing cost effective, high speed wireless data connectivity to consumer electronic applications.This licensing agreement comes on the heels of Philips Semiconductors recent demonstration of wireless transmission using IEEE 1394, which took place at Internationale Funkausstellung (IFA) 1999 Aug. 28-Sept. 3 at the Hotel Berlin. This demonstration featured an MPEG-2 data stream generator that fed a multiple transport stream into a Philips Semiconductors Set Top Box (STB). It established W-OFDM as the most bandwidth-efficient wireless transmission technology and the only technology capable of providing data rates required to facilitate in-home multimedia networking.

Wi-LAN currently supplies its patented W-OFDM product to national networks for high-speed wireless Internet Access including telephone companies such as the national Swedish Telephone Company, Telia, and RSL Com Canada, a fully-owned subsidiary of RSL COM (NASDAQ:RSLC). It also serves large national Internet and Intranet service providers such as Tele2(UK), a subsidiary of Millicom International (NASDAQ: MICCF), cable companies and regional school districts. Wi-LAN is currently proposing systems for various public high-speed wireless data networks worldwide.

Philips Semiconductors, a division of Royal Philips Electronics, headquartered in Eindhoven, The Netherlands, is the eighth largest semiconductor supplier based on Dataquest's 1998 report^*). Philips Semiconductors' innovations in digital audio, video, and mobile technology position the company as a leader in the consumer, multimedia and wireless communications markets. Sales offices are located in all major markets around the world and are supported by systems labs. Additional information on Philips Semiconductors can be obtained by accessing its home page at http://www.semiconductors.philips.com

^*) Based on Vendor Revenue from Shipments of Total Semiconductors Worldwide according to Dataquest's 1998 Worldwide Semiconductor Market Share report published in May, 1999.

Wi-LAN Inc., based in Calgary, Alberta, Canada, delivers wireless data/Internet communications products that provide infrastructure and high-speed networking equipment for public and private wireless data networks. Wi-LAN's recently launched I.WiLL™ 30Mbps access point is based on its patented W-OFDM technology and carries unprecedented speeds in its industry class. The company's Hopper™ and Hopper Plus products have been sold in more than 50 countries on six continents. Wi-LAN is the 1999 recipient of the CATA Alliance Award of Distinction for Emerging Technology. Wi-LAN™ shares trade on the Alberta Stock Exchange under the symbol WIN. Detailed information on Wi-LAN can be found on the Web at  http://www.wi-lan.com