Microsoft paid Nokia $250 million to use Windows Phone

Microsoft paid Nokia $250 million to use Windows Phone
Nokia just posted its hugely anticipated Holiday quarter results and summed up its financials for 2011. Not surprisingly, the company posted a huge loss of nearly $1.4 billion (1.07 billion euro), but what’s even more interesting - Nokia is getting paid by Microsoft to make Windows Phones.

Nokia received a $250 million “platform support payment” from Microsoft, just because it is making Windows Phone devices. Nokia also notes that this is the first from a series of payments from Redmond, but it seems that Microsoft has to up that sum to make up for Nokia’s huge loss.

Previously, Nokia’s CEO and ex-Microsoftite Stephen Elop, said that the Finns are to get billions, not millions in support funds from Microsoft.

“Our broad strategic agreement with Microsoft includes platform support payments from Microsoft to us as well as software royalty payments from us to Microsoft” Nokia said. ”We have a competitive software royalty structure, which includes minimum software royalty commitments.”

This hints that additionally the Finns might be paying less for royalties than other Windows Phone makers, which could turn out to be a very irritating discovery for other WP handset makers. Nokia has shipped "well over 1 million" Windows Phone devices up to date, but it stayed mum on sales of its other high-end platform MeeGo.

source: Nokia via SlashGear

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10 Comments

1. ChiX017

Posts: 308; Member since: Nov 09, 2011

not really, I mean others did not sign the type of agreement Nokia was squeezed into signing, besides its going to be their only life line..

2. Bluesky02

Posts: 1439; Member since: Dec 05, 2011

In order to get so much funding, i'm sure this agreement included the use of WP OS Only for all smartphone lineup. I guess Microsoft wanted Nokia to represent WP.

3. Jericho unregistered

Microsoft broke my heart.i hate nokia come on. Going back to my good old android. Atleast google dont take sides. :'( #android4ever

4. kylie

Posts: 9; Member since: Jan 22, 2012

except they want motorola to be succesful

9. kainy

Posts: 165; Member since: Aug 10, 2011

Dude you must read again what you just typed...

5. MickDM

Posts: 63; Member since: Nov 29, 2011

"not surprisingly" because you were aware of the fact that thier Location and Commerce department was recently stood up and is operating at a loss currently? or maybe because you knew that the Nokia/Siemens venture has not performed well at all? certainly not because their phone business MADE $1.16 billion...although it is apparent the suggestion is that the phone business is to blame...are there no boundaries to the anti wp/nokia/verizon slant here? of course nokia is the first & only company to receive monies from an outside entity to aide in development and/or marketing of a new product, right? WOW, Victor!!!! ijs ;)

6. remixfa

Posts: 14605; Member since: Dec 19, 2008

considering how much MS makes off of Android manufacturers, It should probably read "Android paid Nokia..." lolol :)

7. rex1213

Posts: 77; Member since: Jul 29, 2011

If I remember it right, it was mentioned that Microsoft will pay Nokia more than $1 billion to promote and develop Windows Phone 7-based handsets as part of their smartphone software agreement yet only now it is reported that the sum just ticks around $250 Million? I don't know if the dollars that Nokia will be receiving from Microsoft is printed on the agreement that Nokia and Microsoft made to pursue the deal, but if it is there and if it states there that Nokia will be receiving $1billion of funding from Microsoft, then I think Nokia has the right to sue Microsoft for breach of contract. Except that, Nokia will not do it because Elop is a mole from Microsoft anyway.

8. ivanko34

Posts: 617; Member since: Sep 04, 2011

1 million phones $250 million = $250 for each phone Lol !

10. -box-

Posts: 3991; Member since: Jan 04, 2012

I don't see why the other manufacturers would be upset about lower royalties: they can always make that money with another Android model, whereas Nokia is WP7-exclusive for their new smartphones.

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