This strong growth in licensing and royalty revenue allows ARM to keep investing for the future and deliver increased profits and cash generation.

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Qualcomm, a developer of mobile-phone chips and technology based in San Diego, earns roughly 40% of its revenue from licensing and royalty fees for technology developed primarily in America, where three-quarters of its employees work.

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He's talking to the company about possibly cross-licensing technologies to avoid royalty payments, or getting a discount.

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Gene patents are potentially even more lucrative and the challenge here is the patent protection that prevents other companies from advancing genetic research without paying a royalty or licensing fee.

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Qteros and Praj will ask for an up-front licensing fee and then a percentage of the cash flow, a kind of royalty, from the ongoing operation.

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In one corner is the MusicFIRST Coalition, which includes the Recording Industry Association of America, several artist groups and SoundExchange, the folks who collect licensing fees from satellite and Internet radio stations and distribute it in the form of royalty payments to musicians.

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