Print 11 comment(s) - last by Skywalker123.. on Apr 25 at 2:04 PM

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. (MSFT) VP and general counsel Horacio Gutierrez posted that his company had successfully coerced... er... convinced top Chinese Android smartphone maker ZTE Corp. (SHE:000063) to pay royalties.  The news comes hot on the heels of Microsoft's announcement that top Taiwanese manufacturer Hon Hai Precision Industry Comp. Ltd. (TPE:2317had 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:


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 Huawei Technologies Comp. (SHE:002502) 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 like HTC Corp. (TPE:2498and Samsung Electronics Comp., Ltd. (KSC:005930) 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 many more royalty deals 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]



Source: Microsoft

Comments     Threshold


RE: die M$...please!
By Mitch101 on 4/25/2013 8:05:10 AM , Rating: 3
I agree about time someone is calling out China and them realizing maybe its time to pay up.

Every major corporation does this. Apple, Google (through Motorola so it doesn't look like they play evil either), Microsoft, etc etc etc.

This is 2011 but you get the idea.

