Microsoft gets $5 from every HTC Android device sold, income from Android surpasses WP revenue
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Pritchard however didn’t release any data about the price of the license for Microsoft’s own Windows Phone platform, but instead shared expectations about many more lawsuits coming in Google’s direction as “Google appears to have very little IP to defend itself with." Asymso’s Horace Dediu however assumes a $15 royalty payment for Windows Phone handsets and at 2 million units of admitted sales so far, that translates into revenues of some $30 million.
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What’s more shocking is the fact that - based on analyst Asymco’s rough estimations – Microsoft has five times more income from Android than it has registered from its own Windows Phone platform. Some 30 million HTC Androids sold so far make for a total of $150 million solely from licenses for Redmond. In addition, another Citi analyst, Kevin Chiang, shared his estimate on Android device producers operating margins standing at 10% to 15% for handsets, while for tablets the number stood at the mere 2% to 3%.
To put it all in perspective, the average selling price of HTC-made phones hovers around the $360 mark, so that translates into a 1.39% share Microsoft snatches from the cost of the smartphone. If the software giant manages to force all phone makers to pay the patent fee, it would certainly swing the scales towards Windows Phone as Android would turn to be considerably less profitable. Could this be a momentum changer for Windows Phone? Feel free to drop your two cents in the comments section below.
source: Business Insider, Asymco
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26 Comments
24. Lucas777 posted on 27 May 2011, 17:47 2 2
how? microsoft is just protecting their ideas... and they are doing it very smartly if the money is accurate...
2. Come on (unregistered) posted on 27 May 2011, 10:09 5 2
Shame? Since when is getting paid for one's innovations shameful?
6. android_hitman posted on 27 May 2011, 10:37 3 2
true ! why IphoneArena does not post how much money apple takes from developpers and from their patents?
19. 530gemini posted on 27 May 2011, 15:02 1 2
Because developers need to give Apple their share, just like android developers give google their share, just like WP developers give Microsoft their share. You're not very smart, are you?
16. 123paliloi (unregistered) posted on 27 May 2011, 12:32 3 1
HTC doesn't pay Microsoft for innovation, but only for the reason that they are afraid. HTC is a little company (he was, a year ago when it was threatened by MS). If Microsoft thought that this was legitimate, why threaten HTC and not Google ??? They should logically threaten Google and only Google. It is mainly done to intimidate, they never ask the same to big companies…
ANDROID is based on linux. Where is the link with Microsoft ?
23. Lucas777 posted on 27 May 2011, 17:46 2 1
just cause its based on linux.. (although it stole javame) doesnt mean it doesnt violate microsofts patents.. this is a problem for google and although they dont make money on android, manufacturers might move to other oses if they have to pay these fees anyways...
3. remixfa posted on 27 May 2011, 10:27 6 0
i doubt 5 bux will make manufactures blink. Especially with the rate of activations that android is having. They will just raise the cost to the carriers by 5 bux and call it a day.
4. snowgator posted on 27 May 2011, 10:28 0 0
This is a strange, strange headline. I am not sure I understand. I am depending on someone with a higher IQ then me to explain this one. Anyone???
11. protozeloz posted on 27 May 2011, 11:43 2 0
if im no mistaken is that android sales from HTC are giving MS more money that sales from WP7.....
5. Sailred (unregistered) posted on 27 May 2011, 10:33 1 0
Most manufacturers are also paying significant royalties to Nokia, so MS & Nokia partnership does get a decent pricing edge over Android on this.
9. Droid_X_Doug posted on 27 May 2011, 11:39 1 0
Maybe they (Nokia and MS) should just license their IP? Then they can have a win instead of spending all they have been on phones that are not selling....
7. applepiter (unregistered) posted on 27 May 2011, 11:08 0 9
Mark my words, Microsoft will win the os war!
10. Droid_X_Doug posted on 27 May 2011, 11:41 3 0
Yeah, right. When WP10 finally outsells Android (if that ever happens) please re-post your post.
13. taz89 posted on 27 May 2011, 12:01 1 0
and yeah who would have thought apple/android would be where they are now 5 or so years ago..not saying microsoft will become no1 but anything can happen
18. jroc74 posted on 27 May 2011, 14:44 0 1
This is so true....so true.....
17. NMexpo (unregistered) posted on 27 May 2011, 12:44 1 3
Having switched from Android to WP7, I am going to have to agree with you on this one. WP7 is amazing already and still has a lot of room for improvement. Live tiles FTW!!!
20. pyckvi posted on 27 May 2011, 15:04 1 1
For those of us who have already played with a WP7 device, already know that WP7 phones are GREAT!!! but no matter how great it is, i would not say that it will outpace/outgrow android & iphone.
27. agent7 posted on 28 May 2011, 08:10 2 0
It says a lot when money from patent violations are a bigger source of income than from your own product. I have nothing against Microsoft at all. I have 3 PC's with Windows 7. But they have a long way to go in the wireless industry. I hope they get there. I am always interested in the next best thing. Who knows, it may be them in the future. For now, it is not. For those of you that have the OS and love it, awesome. I'm glad that you have a phone that works for you. But, for the majority of us, it's either Android or iOS. We will just have to keep our eye out and watch the horizon.
22. justworkin' (unregistered) posted on 27 May 2011, 15:41 0 0
I wouldn't go so far as to say they will win, but I have to admit, W7 is actually pretty good. It is EASY to use, easier than Android, but not as simple as iOS, and it does seem to be quite refined. I HATE Bing Search, and I am pretty much a full out Android fanboy, but I still like what I see with W7.
I'll give them another year, and if the W7 hardware reaches parity or surpasses what Android hardware manufacturers are putting out, I will consider a change over.
