Another One Bites the Dust: ZTE Caves to Microsoft's Android Licensing Demands
April 24, 2013 11:27 AM
comment(s) - last by
Top Chinese phonemaker will pay Microsoft royalties on its devices
And then there was one less.
I. ZTE Caves to Licensing Demands
On Tuesday, Microsoft Corp. (
) VP and general counsel Horacio Gutierrez posted that his company had successfully coerced... er... convinced top Chinese Android smartphone maker ZTE Corp. (
) to pay royalties. The news comes hot on the heels of Microsoft's announcement that top Taiwanese manufacturer Hon Hai Precision Industry Comp. Ltd. (
had agreed to licensing
. Hon Hai owns the Chinese manufacturing subsidiary Foxconn.
In his commentary Mr. Gutierrez comments that Microsoft pays for licensing all the time, just like it's forcing OEMs to. He writes:
Much of the current litigation in the so called “smartphone patent wars” could be avoided if companies were willing to recognize the value of others’ creations in a way that is fair. At Microsoft, experience has taught us that respect for intellectual property rights is a two-way street, and we have always been prepared to respect the rights of others just as we seek respect for our rights. This is why we have paid others more than $4 billion over the last decade to secure intellectual property rights for the products we provide our customers.
ZTE will pay Microsoft on every handset it makes. [Image Source: Reuters]
The licensing deal with ZTE is a big deal as the Chinese OEM is vying with
Technologies Comp. (
) for the title of the world's second largest Android phonemaker.
II. Licensing Remains Microsoft's Top Smartphone Cash-Driver
Nearly three-quarters of Android manufacturers now license Microsoft intellectual property. Microsoft has pressured top Android OEMs
Electronics Comp., Ltd. (
) into licensing payments of $10 or more per Android device sold.
Reports from 2011 indicated that Microsoft is
making far more money from these licensing agreements
than from its own smartphone product, Windows Phone. Given that Android growth has
outpaced Windows Phone growth
and Microsoft has scored
since then, it's relatively safe to say that situation remains even more true today.
Royalties are where the money's at for Microsoft. [Image Source: Life's Cheap Thrills]
Among the top companies to try to fight Microsoft's licensing threats have been Google Inc. (
) subsidiary Motorola Mobility and Barnes & Noble Inc. (
). Barnes & Noble -- perhaps the most vocal critic of Microsoft's threats --
in April of last year, "partnering" with Microsoft and agreeing to pay royalties.
Google/Motorola -- whose legal counsel
compared Microsoft to a "deranged Easter bunny"
-- is still fighting the good fight when it comes to patents. However, the company faces a major judgment day this Friday in Germany. If it loses, it may see its handsets not only banned, but also
seized and destroyed
. Some experts believe that a loss in Germany could force Google to swallow its pride and agree to licensing after long encouraging OEMs to fight Microsoft's demands.
This article is over a month old, voting and posting comments is disabled
RE: die M$...please!
4/25/2013 2:04:35 PM
you're more than ignorant and a fool to boot. I am not commenting on zte, rather Microsoft's willingness to rip patents when and where they can
You have the story completely wrong.
n 1993, Microsoft released MS-DOS 6.0, which included a disk compression program called DoubleSpace. Microsoft had previously been in discussions with Stac to license its compression technology, and had discussions with Stac engineers and examined Stac's code as part of the due diligence process. Stac, in an effort led by attorney Morgan Chu, sued  Microsoft for infringement of two of its data compression patents, and won; in 1994, a California jury ruled the infringement by Microsoft was not willful, but awarded Stac $120 million in compensatory damages, coming to about $5.50 per copy of MS-DOS 6.0 that had been sold. The jury also agreed with a Microsoft counterclaim that Stac had misappropriated the Microsoft trade secret of a pre-loading feature that was included in Stacker 3.1, and simultaneously awarded Microsoft $13.6 million on the counterclaim. 
While Microsoft prepared an appeal, Stac obtained a preliminary injunction from the court stopping the sales of all MS-DOS products that included DoubleSpace; by this time Microsoft had already started shipping an "upgrade" of MS-DOS to its OEM customers that removed DoubleSpace. By the end of 1994, Microsoft and Stac settled all pending litigation by agreeing that Microsoft would make a $39.9 million investment in Stac Electronics, and additionally pay Stac about $43 million in royalties on their patents.
"And boy have we patented it!" -- Steve Jobs, Macworld 2007
Foxconn's Parent Settles With Microsoft Over Android Licensing
April 17, 2013, 12:33 PM
Nikon Agrees to Pay Microsoft "Android Tax" on Smart Cameras
February 22, 2013, 12:05 PM
China's Huawei Sees Strong Comeback in 2012, Despite U.S. Scrutiny
January 21, 2013, 2:54 PM
Germany Could Destroy Motorola Handsets After Microsoft Victory
July 30, 2012, 11:11 AM
IDC: Apple and Samsung Steadily Climb as Nokia, HTC, and RIM Plummet
May 1, 2012, 2:53 PM
Quick Note: Apple Watch to Get Brick and Mortar Boost From Best Buy
July 27, 2015, 3:00 PM
Can HTC Save Its "RE Grip" Smartband After Its Inexplicable Failure Launch?
July 17, 2015, 2:29 PM
Facebook's "Moneypenny" is Cross Platform Siri on Steroids
July 15, 2015, 3:59 PM
Apple Watch Sales Have Plummeted
July 8, 2015, 5:01 PM
Consumer Reports: Galaxy S6 and iPhone 6 Can't Keep Up w/ Galaxy S5
July 6, 2015, 4:57 PM
Apple iOS 8.4 Rolls Out w/ Fix to Crash-Causing Unicode Text
June 30, 2015, 3:24 PM
Most Popular Articles
As iPad Sales Wane and Watch Flops, iPhone Saves Apple's Profit With Its Heroics
July 22, 2015, 6:13 PM
Editorial: Reddit Allows Itself to be Hijacked as a Hate Platform For Racist Bigots
July 21, 2015, 6:32 PM
Microsoft July 29 Windows 10 Launch: Freebies, Rollout, and What's Next
July 21, 2015, 2:40 PM
Mozilla and Facebook to Adobe: It's Time to Kill Flash
July 20, 2015, 6:30 PM
Google Scores Bizarre Court Win as Disgruntled Android Users' Lawyers Ruin Case
July 16, 2015, 5:58 PM
Latest Blog Posts
Sceptre Airs 27", 120 Hz. 1080p Monitor/HDTV w/ 5 ms Response Time for $220
Dec 3, 2014, 10:32 PM
Costco Gives Employees Thanksgiving Off; Wal-Mart Leads "Black Thursday" Charge
Oct 29, 2014, 9:57 PM
"Bear Selfies" Fad Could Turn Deadly, Warn Nevada Wildlife Officials
Oct 28, 2014, 12:00 PM
The Surface Mini That Was Never Released Gets "Hands On" Treatment
Sep 26, 2014, 8:22 AM
ISIS Imposes Ban on Teaching Evolution in Iraq
Sep 17, 2014, 5:22 PM
More Blog Posts
Copyright 2015 DailyTech LLC. -
Terms, Conditions & Privacy Information