Broadcom Cuts Verizon Deal

IRVINE, Calif. and NEW YORK -- Broadcom Corporation (Nasdaq: BRCM - News) and Verizon Wireless, an affiliate of Verizon Communications Inc. (NYSE: VZ - News), today announced a licensing agreement that permits the continued importation and sale by Verizon Wireless of mobile devices that are the subject of the current litigation between Broadcom and Qualcomm Incorporated (Nasdaq: QCOM - News) before the U.S. International Trade Commission.

The agreement allows Verizon Wireless, the largest wireless provider in the country by revenue, to sell new handsets and other wireless devices, ensuring the availability of the latest cell phone technology in handsets and personal digital assistants (PDAs) to consumers and businesses. Under the agreement, Verizon Wireless will make payments to Broadcom at a rate of $6.00 for each 1xEV-DO handset, PDA or data card sold after the effective date, subject to a maximum payment of $40 million per calendar quarter and a lifetime maximum payment of $200 million. The agreement provides Verizon a license to the six Broadcom patents currently being litigated between Broadcom and Qualcomm. Other terms and conditions of the agreement are confidential.

As a result of the agreement, Verizon Wireless will also cease its efforts to overturn the ITC's recent order banning Qualcomm chips and certain cell phones based on those chips from importation, and will withdraw Verizon Wireless's motion to stay that same ITC remedy previously filed with the U.S. Court of Appeals for the Federal Circuit.

"We are pleased to have worked out an agreement with Broadcom to ensure continued delivery of new and innovative products to our customers," said Lowell C. McAdam, President and Chief Executive Officer of Verizon Wireless. "A market-based solution, like the one our two companies have announced today, is the most effective way to resolve these kinds of intellectual property issues."

"Broadcom welcomes the opportunity to work with Verizon to ensure that next generation cell phones and personal digital assistants operating on the Verizon Wireless network will continue to flow into the United States," said Scott A. McGregor, President and Chief Executive Officer of Broadcom. "This agreement reflects not only the strength of our intellectual property portfolio in the wireless space but also Broadcom's commitment to work constructively with other industry players to resolve I.P. disputes and forge important new business relationships."

Separately, Broadcom and Verizon Communications announced that they have entered into a strategic alliance. Verizon's new Chief Technology Officer, Dick Lynch, said, "We will pursue a broad-based initiative with Broadcom involving new mobile device chipsets and other products, including Bluetooth® and wireless LAN solutions, optical network solutions, Multimedia over Coaxial Cable (MoCA) devices, GPS location technology, and DSL and fiber network components including set-top boxes, and pursue technology cross- licensing opportunities. Our mutual goal is to increase the availability of new, competitive products and services for our customers."

Broadcom Corp. (Nasdaq: BRCM)

Verizon Communications Inc. (NYSE: VZ)