Microsoft makes three times more off patent licensing than its own mobile OS

August 5, 2011
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Microsoft is really putting the screws to many companies in the Android realm with patent licensing deals that have turned out to b every lucrative. Microsoft holds several key patents and most of the key Android players are now paying Microsoft to license those patents. With the popularity of Android and the lack of popularity of Windows Phone 7, this may come as no surprise.

Microsoft makes more money off licensing its patents than it does off WP7. Not just a little more money either, Microsoft reportedly makes three times as much off licensing patents as it does WP7. Analyst Horace Dediu from ASymco claims that Microsoft makes about $15 per license for WP7 to HTC.

At the same time, it licenses the patents for Android to HTC for $5 per device and that is only one carrier. Microsoft has landed a gaggle of phone makers that are all licensing those patents and some may be paying more than HTC. For Q2 2011 Microsoft made $21 million off WP7 licensing and about $60 million from patent licensing.

[via Gottabemobile]


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  • Lee

    This isn’t about Microsoft’s source of income being it’s inventions. This is how they killed Netscape, and competing OSes. Strategically discounting their products. Giving away internet explorer for free and having installed by default in Windows. Threatening to raise the price of Windows OS to OEMs who would sell products with other competing OSes. Microsoft isn’t a unique case either, this is the general lawlessness of the environment and how corporations try to survive, this isn’t about who creates the best operating system, it’s about leverage, patents are one of those leverages.

  • http://twitter.com/jakcrow Jak Crow

    Correction: Microsoft CLAIMS they hold several key patents. No one has challenged them for what are ridiculously general patents.

    • http://pulse.yahoo.com/_F7TOLHY6F4HW6ZYT6CECLWU2QY Stu Beef

      Really? Perhaps you won’t mind, in your infinite wisdom of patents and patent law, describing these, “ridiculously general patents” so that we less informed can understand what you’re talking about. Some proof of your claims would be nice too. Did you ever consider that maybe these companies are paying MSFT because they feel they have little chance in the courts? I know some people like to claim that battling MS in the courts would be more expensive, but those people are compelte morons. Let me assure you, it would cost far less than paying licensing fees for many years to come, especially on as OS That is currently the most popular and gaining quite regularly.

      Good luck, by the way. You’re going to need it, since Microsoft holds many, many thousands of pantents and I’m pretty sure that neither Microsoft nor those paying the fees have let you in on the details of why they’re paying.

  • Anonymous

    I love my windows pc and I love my xbox 360, but man, fuck microsoft

  • Anonymous

    I love my windows pc and I love my xbox 360, but man, fuck microsoft

  • http://pulse.yahoo.com/_F7TOLHY6F4HW6ZYT6CECLWU2QY Stu Beef

    I really don’t care for these claims, because I don’t believe they tell us anything about the potential for WP7. You have to consider that it’s been some time since new handsets have been released and also, the wait for Nokia to realease some phones. We must also consider the release of Mango. With the update released, we’ll start seeing new WP7 phones on the market and probably a much, much better and broader selection than currently exists. Does that mean that WP7 will take off and sell like crazy? No, it just means that we’ll get a much better picture of whether or not the platform is going to start gaining some traction. Having used it and developed for it, I believe that it will. Will it get to the level of Android and ios? Who can say. Any predictions about how much it will grow are just guesses, some of them educated ones and some of them complete rubbish and everything in between.

    One things for sure: Making money off Android handsets puts them in a position to wait longer for WP7 to take off and become a competitor. I couldn’t tell you how strong of a claim they have against manufacturers, but judging by how those manufacturers are giving in to the fees, I’d guess that MSFT is standing on pretty solid groud with their claims. Some people may disagree with that claim and that’s alright, but some of these manufacturers are not small fries and they could certainly fund a fight against Microsoft if they thought that they had a leg to stand on. It would be different if it were just smaller companies giving in, but that’s not the case in this situation.

    WP7 will either take off or some point or it won’t. Many people have their opinions about that, but how many of those opinions are based on experience with the platform? Very few… Nothing makes me laugh more than hearing someone attempting to bash a product that they’ve never even laid their hands on and used. A smaller group have tried WP7, Android, ios, Blackberry and can give an honest opinion on each platform’s strenghts and weaknesses. It’s usually pretty easy to tell who those people are, as opposed to the one’s speaking out of the a**. Some will give each a legitimate chance and try to see the good and bad in each and some will be biased for little real reason. I count myself among the educated when it comes to each of these platforms and, for the most part, among the unbiased as well. I like WP7 and see a lot of potential with the platform. It has it’s advantages and disadvantages, just as the rest do. if it takes off at some point and becomes a hit, that’ll be fine with me. It’ll just give me one more choice when choosing a mobile product. If it never takes off, well, that’ll be fine too. However, I’d hope that ignorance isn’t the reason if it never takes off. If people try and and don’t like it, that’s one thing, but people who’ve never even used it or probably never even held it, that’s shameful.