Microsoft gets $5 from every HTC Android device sold, income from Android surpasses WP revenue
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.
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
1. Motosurf (unregistered)
Money of shame
24. Lucas777 (Posts: 2121; Member since: 06 Jan 2011)
how? microsoft is just protecting their ideas... and they are doing it very smartly if the money is accurate...
2. Come on (unregistered)
Shame? Since when is getting paid for one's innovations shameful?
6. android_hitman (Posts: 583; Member since: 07 Jul 2010)
true ! why IphoneArena does not post how much money apple takes from developpers and from their patents?
19. 530gemini (Posts: 2198; Member since: 09 Sep 2010)
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)
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 (Posts: 2121; Member since: 06 Jan 2011)
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 (Posts: 13901; Member since: 19 Dec 2008)
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 (Posts: 3149; Member since: 19 Jan 2011)
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 (Posts: 5285; Member since: 16 Sep 2010)
if im no mistaken is that android sales from HTC are giving MS more money that sales from WP7.....
5. Sailred (unregistered)
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 (Posts: 5155; Member since: 22 Dec 2010)
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)
Mark my words, Microsoft will win the os war!
10. Droid_X_Doug (Posts: 5155; Member since: 22 Dec 2010)
Yeah, right. When WP10 finally outsells Android (if that ever happens) please re-post your post.
13. taz89 (Posts: 1901; Member since: 03 May 2011)
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
17. NMexpo (unregistered)
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 (Posts: 48; Member since: 19 Dec 2010)
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 (Posts: 19; Member since: 20 Apr 2011)
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)
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.
14. asdf (unregistered)
the market will never swing towards WP. the product their engineers put out is pure FAIL compared to Android and even iOS.
15. Stu (unregistered)
with a lot of android handsets locking their bootloader, android is in big trouble. while the number of rooters is small compared to the overall number of phone users, they have a big influence on the overall community. Also, sophisticated users tend to contribute more to word-of-mouth type advertising. For a long time I have been pumping the Evo as the greatest phone in the world, largely due to its ability to run CM6 (and now CM7). The Evo 3D COULD be the new greatest phone in the world (to me) but not if I am stuck with manufacturer firmware. There is a HUGE difference in battery life on rooted phones, not to mention moderate improvements in overall speed, and the ability to get rid of annoying bloatware.
At some point I can see myself moving to a POS flip-phone and a tablet that lets me do a lot more awesome stuff without having to deal with manufacturer/cell phone provider sluggishness.
21. jroc74 (Posts: 3630; Member since: 30 Dec 2010)
Locking the boot loader is not gonna be the downfall of Android. I will use my girl friend as an example...She had a Blackberry. Someone stole it. She has had my Droid X for about a month.....and acts like she wont give it back.....
Yea....the bootloader played zero part in it. She likes the way better browsing.
She wants either an iPhone or Android phone. She's leaning more towards Android cuz she wants to go to Sprint. I woulda steered her away from the iPhone 4 and probably to the 3GS for the antenna issue. So for individuals that we personally know, yea we can effect their buying decision. But that isnt gonna snowball into effecting the entire or the majority of the general public.
The downfall of Android will be if Android stops improving..as long as they keep trying to get better, they will be fine. Or if they get sued into oblivion...
I love rooting n custom ROMs, but to think bootloaders and the root, ROM community will influence the overwhelming majority of the general public, is kinda crazy. Do you think everyone that buys an Android phone joins Android websites? How about even in the forums....there are always waay more views of a topic than actual posts?
One of the biggest Android forums has 200,000 members....how many do think you are rooters and have custom ROMs? Even within Android forums, the root, ROM community doesnt sway the majority of members to even root their phones, let alone use custom ROMs. Even Samsung's track record for updates didnt hurt the Galaxy S line in sales....
The root, ROM community is like the overclock community for PC's. Its a big community, but it doesnt effect the sales of specific cpu's, gpu,s to such a great extent that manufactures are affected by it.
The majority of folks in the general public will here stuff about boot loaders, ROMs and will decide for themselves what they want, they will not get swayed by the facts its fully open. Look at the Linux desktop market as an example....and thats with a free desktop OS....You think Android grew and is growing the way it has because of custom ROMs, open boot loaders?
Look at how many ppl bought the Droid X last year, and this was after huuge threads about the eFuses, and encrypted bootloaders. There are ppl to this day that are thinking about getting a Droid X. The bootloader played zero part in the equation.
Look at the virus, spyware world. Windows PC's are the most targeted PC's in the world...Windows PC's is also the most used PC in the world for households. If the security community cant cause a dent for OS X or Linux on desktops in households, the root, ROM community isnt gonna do much for steering ppl away from phones with locked bootloaders.
Not trying to downplay the community, but sometimes reality is just that....reality....
29. theBankRobber (unregistered)
WP7 is not going to win Shit let me tell you that, like EVERY OS VERSION they have or had with pc OS and phone OS gets out dated by its own provider, Microsoft. When you make a OS and never fix issues and just abandon it to create another then you have lost your respect to be called a OS provider. WP6 can't get features of WP7, and in order to get WP7 to get features of WP8 you will need to upgrade to a new phone, just like their desktop OS. Win xp ran great, upgrade to win vista and your computer is Shit. Upgrade your computer for win Vista then out comes win 7, upgrade and again, computer is Shit.
39. xtremesv (unregistered)
The M$ patent must be something foolish as: "inventing" the idea of a mobile operative system in 1984. This patent fever is starting to be annoying, the US laws allow to patent almost eveything (icon forms for example), and the rest of the world must comply with them, it's absurd. Things have to change.
41. Ap (unregistered)
Have used WP7 on Dell Venue Pro..my experience was very very good!.interface is damn good...but syncing, maps and apps have a long way to go! if I wasnt such a maps user..I would have stayed with it much longer.