Microsoft Earns More from Android than Windows Phone 7

It turns out that a lot of people haven’t been paying attention. Over the weekend, a story about how Microsoft is earning more from HTC’s Android devices than from its own Windows Phone 7 sales spread all across the web, with surprised reactions everywhere. Anyone who has been paying attention to Microsoft’s recent patent trolling regarding Android could’ve seen this coming.

Citi analyst Walter Pritchard revealed that HTC pays Microsoft $5 for every Android device it sells, as part of the patent deal between the two companies. Microsoft is currently suing other Android phone makers, and is seeking $7.50 to $12.50 per device, according to Pritchard. This is what Steve Ballmer referred to as ‘Android’s patent fee’.

As I have already said numerous times on OSNews: this is mafia behaviour. Microsoft is basically bullying Android device makers into paying protection money, probably with the goal of making this protection money about as much as the cost of a Windows Phone 7 license. Horace Dediu did some quick maths, and came to the conclusion that Microsoft earns more from HTC’s Android devices than it does form its own Windows Phone 7; Microsoft has admitted selling 2 million WP7 licenses, and assuming a price of $15 per license, that’s $30 million in revenue. Using the rough estimate of 30 million HTC android devices, you come to the conclusion that Android earns Microsoft more than WP7.

I’m not surprised about this, and honestly, I can’t even get angry about this anymore. I mean, the odds of the US patent system changing are slim; why would those in power in the US change a system that is beneficial to US companies? Microsoft gets more money at the expense of a small Taiwanese company – and why, exactly, would the US government change that system? Conversely, do you honestly believe the judges in, say, the Apple v. Samsung case, are impartial? I’ve got a unicorn to sell you, princess.

That’s the cold harsh reality of the technology world today, kids. Why compete by making better products that people want to buy, if you can just use what should be illegal and criminal means to gain an advantage over a small competitor?

79 Comments

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