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According to new reports, Microsoft is pulling in some big bucks thank to Android phone sales
Royalty payments add up for Microsoft thanks to strong Android sales

It's no secret that Microsoft's Windows Phone 7 operating system has gotten off to a slow start. Microsoft CEO Steve Ballmer has said that the smartphone operating system came to market about a year too late; hence it's facing stiff competition from seasoned competitors like Apple's iOS and Google's Android.

Currently, Windows Phone 7 is treading water with a 1.6 percent share in the global smartphone sector during Q1 2011 according to Gartner. To say that Windows Phone 7 isn't adding much to Microsoft's bottom line would be putting it mildy at this point; at least not until its partnership with Nokia kicks into full gear.

Keeping this information in mind, a Citi analyst reports that HTC is currently paying Microsoft $5 for every smartphone that it sells running Google's Android OS. The payments are a result of a patent settlement that Microsoft reached with HTC.

Horace Dediu of asymco took things a step further and reckons that HTC has shipped around 30 million Android-based smartphones. With royalty payments of $5 per device going to Microsoft, the boys from Redmond have received around $150 million thanks to sales of Android smartphones.

Microsoft claims that it has sold two million Windows Phone 7 licenses -- Dediu estimates $15 per license -- which would bring revenues from its latest smartphone operating system to $30 million. If these numbers are accurate, Microsoft is currently receiving five times as much money from Android than it is from its own smartphone OS. 

As Ballmer stated back in March 2010, there are plenty of costs involved for manufacturers when it comes to putting Android OS on smartphones.  "There's nothing free about Android," said Ballmer. "I mean at the end of the day as we certainly have asserted in a number of cases you know there's an intellectual property royalty due on that."

And HTC is just the beginning when it comes to royalty payments reports Business Insider -- Microsoft is looking for as much as $12.50 per device from other Android phone makers.



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RE: I am surprised.
By Mitch101 on 5/28/2011 12:55:24 PM , Rating: 2
With that said I purchased my phones based on knowing their limitations because app wise weather its 17K, 300K or 500K realistically I only care about 20-30 actual apps and the rest are games that are really playable on a small screen. All the real popular must have apps exist in one form or another on all 3 devices making apps number touting just stupid because most are fart and flashlights and the rest are just clones of more popular apps/games. There is no 500,000 different app categories.

I didn't buy an iPhone because of its limitations on Adobe flash, Apples denial of design flaws, the number of corporate devices we have which have already broken the glass, and since my wife has an iPod were already in disgust of how much of a POS iTunes is. I also dont like that I cant expand the memory. My sansa clip for $17.00 has a memory slot. This is the AOL of devices to me.

I bought the wife a Samsung Epic and I rather like the device it works well for her and would work well for me but I need something for a more corporate setting but I have to admit I would be happy with this device. This is a nice product and I have to say they got a lot of the interface right with a few little things that are so close to right.

I passed on a blackberry for myself as I have a corporate one and I get to test many of the newer ones and personally I think they all suck with their tiny keypads and screens to the touchscreen devices that are just horrible. The only blackberry device that has hope is the thunderbolt but thats AT&T so the service provider kills that for me.

Then there was Palm. Just kidding nothing to see here move along.

I bought my Windows Phone 7 because like Apple they have guideline to standardization so no fragmentation of apps like androids have and the security of something like the Apple store. Not that its horrible on android but I have gotten a few apps that didnt work well with the form factor.
Google is starting to do this because they realize thier devices were becoming fragmented. Im also a Visual Basic developer so I can write apps for the device but am still learning and waiting for mango because of a few items I need for development. The main reason I bought it because NOTHING will compete with Microsoft on Interfacing with Exchange and Sharepoint in the long run and I need that functionality. I would mark it down for not having a memory slot but I have the cloud and an unlimited data plan which uploads my junk to the cloud and I only need to log into my pc to download it.

I will say that Android is a better device than my Windows Phone 7 currently but if Microsoft delivers on Mango then they have competition.

If Apple continues acting like AOL thinking they know whats best for me then I will continue to pass on them. Im still not sure I will ever be able to recover from how horrendous iTunes is.


RE: I am surprised.
By Ragin69er on 5/28/2011 1:51:39 PM , Rating: 3
The real beauty of Android is its openness, I have a launcher called launcher7, which is identical aesthetically to windows phone 7. I have a music player called fede's music which is identical to the zune music player. I have a launcher called adw.launcher which I have themes to make it look exactly like an iphone, or even vanilla Android.
Android gives you the choice to make your phone experience totally different depending on how you feel that day.

I pull out the iphone theme and people have a hard time telling its not an iphone, and between the launcher and music player people really can't tell the difference between windows phone 7.

So user interface is really a win for Android no matter what, because anything any other OS does a launcher or theme will show up to allow Android users the same benefits. Although a phone without widgets is imo a time waster, as I like to check the weather, stocks, and calendar... and being able to do all of that without launching a single app is very nice.


RE: I am surprised.
By Mitch101 on 5/29/2011 11:38:45 AM , Rating: 2
True I was hoping Microsoft would have skinned the interface so you could do anything. Kind of like StarDocks WindowBlinds for Windows Phone 7 would have been and epic win for the gui.


RE: I am surprised.
By Cheesew1z69 on 5/29/2011 8:40:58 PM , Rating: 2
Huh? Thunderbolt is HTC and it's on Verizon....


RE: I am surprised.
By Mitch101 on 5/31/2011 11:20:15 AM , Rating: 2
You are correct my bad. For some reason I get a poor signal with Verizon at home. Have to stand in the back yard to get good bars.


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