As for the current strength we are seeing, could be any one of a number of things, but most likely anticipation of an announcement on either the MEZZO/eVU front or Pat Nunally`s IP efforts.

``“Over the next few months, management will be working closely with him and other outside parties to process our patent portfolio and derive a valuation of our IP in products that we believe are utilizing our flash memory-related patents.``

See Nokia`s news today? Further expansion of products perceived to be possible infringers on EDIG`s patent portfolio.

``Blakeley remarked, “With the assistance of IP veteran, Pat Nunally, and other outside groups and firms, we are identifying potential licensees in the cell phone, PDA/Pocket PC, portable A/V recorder, digital camera, camcorder, and other portable device industries``

We can only sit, watch and hope (and maintain or add to our current EDIG positions in anticipation of a breakout on EDIG`s business plan).

**********************

Nokia buys Loudeye to kickstart iTunes rival

By Tony Smith

8th August 2006 11:00 GMT

Get The Register`s new weekly newsletter for senior IT managers delivered to your in-box, click here. Nokia is to buy Loudeye, the US digital music company that owns On-Demand Distribution (OD2), the European music download supplier started by Peter Gabriel. The Finnish mobile phone giant is paying $60m in cash for the company.

Nokia described the deal as the foundation for its own music service with which it will target owners of its phones, in particular is N-series handsets.

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It said the service will go live next year and target Nokia handsets the way Apple`s iTunes Music Store targets iPods. You can tell that`s the model Nokia has in mind: it specifically described itself ``the world`s largest manufacture of digital music players``.

Loudeye characterised the deal as an indication of its standing in the digital music world, but we`d say it`s a sign of the value of its content distribution licences. Nokia`s essentially buying those to avoid having to negotiate directly with the music labels, particularly those who, having had to deal with the explosively successful Apple isn`t keen on facing another big-brand vendor who`s prime interest is hardware sales.

Loudeye acquired OD2 in June 2004, paying $40.5m in cash and shares for the company. By that point, OD2 had signed deals with a stack of European ISPs, PC makers, music retailers and others to supply, host and maintain digital music stores. Loudeye bought OD2 to bring an international focus to its them US-only offering. Ironically, OD2 proved the more successful of the two and earlier this year, Loudeye sold its US operation to local rival Muze. As a result, Loudye is OD2.

OD2`s problem is that it`s dependent on its brand partners to market its services. Many of them, like Coca Cola, Oxfam, Tiscali, MSN, and Packard Bell, are not music-related companies. As such, the company has struggled to carve out a significant chunk of the market in the face of new, digital music-specific brands like Apple, Napster and Wippit. MSN had six per cent of the UK market in April 2006, according to market watcher XTN Research, compared to Apple`s 44 per cent.

OD2 recently lost Coca Cola, which shut down its MyCoke music service, apparently in favour of a deal with Apple. OD2 has also lost music retailers HMV and Virgin during the past two years.

How the company`s relationships with its current partners will be maintained once Nokia takes over - the deal should be completed in Q4, the phone company said, remains to be seen. Nokia`s interest in driving demand for its phones may see it shift the acquired firm`s focus away from the Windows Media-based services to the Nokia phone-friendly one. In any case, OD2`s partners may not like their idea of working with a supplier who also competes with them directly. ®