Microsoft now paid by 55% of Android ODMs

By Richi Jennings (@richi ) - October 24, 2011.

Microsoft (NASDAQ:MSFT) is now licensing more than half of all Android original device manufacturers, extracting annual license fees estimated at almost half a billion dollars. The latest licensee is Compal (TPE:2324). In IT Blogwatch, pretty soon bloggers are talking serious money.

Your humble blogwatcher curated these bloggy bits for your entertainment. Not to mention: An Airbus fuel pump fault...

    Michael Santo reports:

With this latest signing, Microsoft emphasized that it now has licensing agreements...with Android OEMs that produce more than 50 percent of...Android devices. ... [That's] quite a revenue stream for Microsoft...around $444 million in fiscal year 2012.


Microsoft prefers to sign licensing deals with rivals rather than fight a protracted court battle, Apple has not been willing to do so in its battles.   

    Devindra Hardawar adds:

Compal is the tenth company to form an Android licensing deal with Microsoft...joining more well-known Android manufacturers like Samsung, HTC, and Acer. ... [It] protects them from further patent litigation from Microsoft, as well as from others (like Apple).


Microsoft boasts that it...respects IP by licensing responsibly, so it expects other companies to do the same. ... Microsoft says it now has licensing agreements with 55 percent of Android Original Design Manufacturers. ... Microsoft also says that its agreements now cover 53 percent of the US Android smartphone market.   

Microsoft's Brad Smith and Horacio Gutierrez break out the Champagne-style sparkling wine:

Today's agreement is with Compal, one of the world’s largest...ODM[s]. [B]ased in produces smartphones and tablet computers for third parties and has revenue of roughly $28 billion.


Amidst continuing clamor about uncertainty and litigation relating to smartphone patents, we're putting in place a series of agreements that are reasonable and fair to both sides. ... While lawsuits may dominate many of the headlines, these are being overtaken by the number of license agreements being signed.   

And Jon Brodkin tells us what it means:

When you buy an Android phone, there’s a good chance either the vendor whose name is on the device or one of the manufacturers who contributed hardware to it is paying Microsoft a fee for each sale. ... Some have concluded that Microsoft makes more money from Android than from its own Windows Phones.


You are probably wondering which Microsoft patents have allowed Microsoft to sign up all these vendors. ... Examples include patents related to “implementing both long and short file names in the same file system,” a monitoring system that determines when to erase memory from flash memory devices, and patents related to managing contact databases and meeting requests.   

Meanwhile, Cody Lee sees it as more bad news for Android:

Most cell phone manufacturers see low profit margins in the first place, so $5 per handset can’t be good for business. But since Android device makers are competition for Windows Phone anyways, this puts Microsoft in a win-win situation.


[Y]ou have to ask yourself: “Is Apple worse for Google’s mobile OS, or is Microsoft?” Either way, you can’t imagine that it can survive this onslaught of litigation much longer.   

   And Finally...
Captain Dave suffers a fuel pump fault in an Airbus

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Richi Jennings, your humble blogwatcher

Richi Jennings is an independent analyst/consultant, specializing in blogging, email, and security. He's the creator and main author of Computerworld's IT Blogwatch -- for which he has won American Society of Business Publication Editors and Jesse H. Neal awards on behalf of Computerworld. He also writes The Long View for IDG Enterprise. A cross-functional IT geek since 1985, you can follow him as @richi on Twitter, pretend to be richij's friend on Facebook, or just use good old email: You can also read Richi's full profile and disclosure of his industry affiliations.

Copyright © 2011 IDG Communications, Inc.

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