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Samsung may pay as much as $10 per Android handset sold to Microsoft, in order to protect itself against Apple.  (Source: Cell Phone Blog)
Licensing fee could give Samsung extra legal ammo against Apple

Microsoft (MSFT) and South Korea's Samsung Electronics (SEO:005930) are reportedly engrossed in intense intellectual property licensing negotiations.  The talks bring to mind the old adage "the enemy of my enemy is my friend."

While Microsoft's Windows Phone 7 platform competes with Android, both platforms share a common enemy -- Apple, Inc. (AAPL).  As Apple tries to fend off Android, it has turned to multiple lawsuits, first suing [1][2] Taiwan's HTC Corp. (TPE:2498) (the top Android phone maker at the time) and then suing Samsung (currently the top Android phone maker).

As both Samsung and HTC are also WP7 handset makers, it behooves Microsoft on multiple levels to defend these quasi-rivals.  To that end, Microsoft entered into a patent licensing agreement with HTC last year.  HTC agreed to give Microsoft a fee for every Android handset sold.  In exchange it received the use of Microsoft's IP, which has proved a useful shield to hold back Apple's legal harassment.

Samsung, which has a sizable IP catalog of its own, may opt for a similar deal.  The current sticking point is the licensing fee.  Microsoft wants $15 USD per Android handset sold.  Samsung, reportedly, is willing to agree to around $10 USD per handset.

If the pair can reach an agreement, Samsung could use its new resources to further defend itself against Apple in court.  That would be good news for U.S. customers, who could lose access to Samsung's Android lineup if Apple succeeds in blocking imports from the Asian gadget maker.

Samsung will soon become the world's largest phone maker, passing Microsoft's Finnish ally, Nokia Oyj. (HEL:NOK1V).  The company is expected by analysts to have sold 3 million units of the Galaxy S II since its late April debut, helping propel the company to total estimated sales of 19 million units in calendar Q2 2011.



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heh
By sprockkets on 7/6/2011 11:46:22 AM , Rating: 1
If Android could drop FAT altogether the licensing fee may drop to like $2.

Otherwise a lot of the patents Microsoft holds against others are stupid pointless crap that should never been granted in the first place.




RE: heh
By Digimonkey on 7/6/2011 12:02:05 PM , Rating: 3
You know I've never heard of Microsoft engaging in frivolous lawsuits with anyone. Maybe somehow they keep it under radar, but I've heard quite a few stupid lawsuits come from Apple.

quote:
Otherwise a lot of the patents Microsoft holds against others are stupid pointless crap that should never been granted in the first place.


Pretty much describes the majority of computer hardware/software patents.


RE: heh
By ipay on 7/6/2011 8:15:53 PM , Rating: 2
MS didn't used to sue anyone, but I think they saw how much money Apple was making off of it and started a few years ago. They still aren't nearly as bad as Apple, but they sue a lot these days.


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