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Microsoft makes more money from Android than Windows Phone


Apple and Microsoft [2] are both going after Android [3] for violating patents. However, their end goals are completely different. While Apple [4] looks to ban the competition from competing, Microsoft looks to create a revenue stream by forcing licensing deals. Microsoft’s strategy is, literally, paying off.

According to unofficial reports (Microsoft does not disclose the details of its licensing agreements with third-parties), HTC pays Microsoft US$10 per Android device sold whereas Samsung pays Microsoft US$12-13 per Android device sold. The royalties from these two companies alone is estimated to be US$792 million in Q2 2012; I’m sure Microsoft’s patent royalties from other Android manufacturers (and other non-Android related companies that Microsoft has signed with) boosts this number even higher.

Comparatively, Microsoft is estimated to subsidize Nokia Windows Phone handsets at the tune of US$250 million per quarter and in return Nokia pays Microsoft US$20 per handset sold. According to third-party counts, there were roughly 5 million Windows Phone shipped by all manufacturers in the last quarter and if we use the US$20 per handset Nokia pays Microsoft (which isn’t exactly accurate since the 5 million Windows Phone devices weren’t all Nokia devices, but bear with me while I try to prove a point), then a rough estimate of what Microsoft makes from Windows Phone is US$100 million per quarter. $792 million vs $100 million and withing having to pay the cost of subsidizing anything except lawyer bungalows. Clearly Microsoft’s investment into R&D (and strong-arm litigation tactics) is being paid off. Again, literally.

[via BGR [5] } Image credit: Seattle Cloud [6]]