Microsoft will make money for every Android device made through Foxconn

Level with me. You’re civil and fairly polite here in the comments on Windows Phone Central. But on other sites you’re a Microsoft fanboy. Don’t worry, there’s one deep down in all of us. Here’s some fodder for the next little flamewar you start with your Android frenemies – Microsoft will pocket dough for every single Android and Chrome OS device that Foxconn makes.

Foxconn is that company you heard about a bit in the news last year over some working conditions for Apple products. However, Foxconn makes products for more companies than just Apple. Foxconn is an original design manufacturer (ODM) for big names like: Acer, Amazon, Cisco, Dell, Google, Microsoft, Nintendo, Sony, Toshiba, and more. Nearly 40% of all electronics on planet earth are made through them, devices running Android and Chrome OS that apparently infringe some patents Microsoft controls.

Never one to let idle money slip by, Microsoft has entered into licensing agreement with Foxconn. It will now collect an undisclosed amount for every device running either Android or Chrome OS. Things like tablets, smartphones, televisions, and laptops. This isn’t the first (nor last) time that Microsoft strikes a deal to collect royalties for Android devices.

Horacio Gutierrez, corporate vice president and deputy general counsel of the intellectual Property Group at Microsoft, has this to say:

“We are pleased that the list of companies benefitting from Microsoft’s Android licensing program now includes the world’s largest contract manufacturer, Hon Hai. By licensing both brand name companies and their contract manufacturers, we have successfully increased the overall effectiveness and global reach of the program.”

The details of the agreement between the two companies is under wraps for now (and probably forever). So there isn’t any word on what exactly Microsoft is using to coerce companies to license patents for all these Android devices.

There you have it, some flamewar fodder. Now, we just need a rebuttal for how Microsoft makes more money on Android than Windows Phone. Anybody?

Source: Microsoft Press Release (opens in new tab), Via: Ars Technica

134 Comments

Why not denial of using those patents and make money on WP... ;)
That's war...
That would be like chopping your own toes.
*nose
Really? Last time I checked, if Android devices break a non FRAND patent, they can be stopped from even selling the device by the patent owner. Imagine no Galaxy devices or HTC high end devices. And if Nexus was gone, that may kill the OS. And one less OS means more chance of market share means more chance of apps and developers means more money from app store purchases. However, Microsoft knows about the slight chance of an anticompetitive lawsuit and as such the lawyers probably advise a licensing deal which will make Microsoft money.
Taking money from you "enemy" is much fun and... what a smart move!!
I bought an android device, so I paid Microsoft.
You also p[aid Nokia too (almost every phone manufacturer does, since Nokia has a library of patents)
Hell yea like I tell everyone Nokia is big boss and all manufacturing phone places are the middle men ...you got the consumer that buys the phones that money goes to the manufacture and then they take ther money to godfather Nokia :P ...so Samsung,apple,HTC,Motorola ECT are all just middlemen
great said my friend.....nokia is godfather in phones department.
Joking aside though, two of those middle men are doing much better than the boss. I do hope Nokia continues to execute and makes a full recovery.
So, why are you here???
More reason to support android for our existence.
If you haven't noticed, Android has been supported enough already
The question is...how long before companies like Samsung wise up about this and take their business somewhere else?
Look up the patent info that won't be any time soon. Also the alternative is also under Microsoft's control.
If your talking about Samsung using Foxconn then that's false. Every single Samsung factory in the world including South Korea, China, Malaysia, Vietnam and so on making smartphones and tablets as well as all the other long list of products samsung do are made in Samsung built and managed factorires. Thats why a Samsung smartphone like my Ativ S or the GS3 says "Made by Samsung". Although they are made in China Samsung are not a customer of Foxconn, which is a good thing. Samsung have very tight quality controls in their factories and comparibly good working conditions and pay.
@Oliver Newell: Reread my statement friend. I wasn't talking about Samsung only! I said "...how long before companies like Samsung...", meaning other Android manufacturers like HTC, LG, etc. But I do agree about Korean conditions being better than the Chinese. With the exception of my Samsung TV, which was Made in Mexico.
Samsung is working on Tizen, we'll see where that leads
@borasar: That they are, yet they are still deeply rooted in Android as well.
Microsoft is already licensing Android patents to Samsung and other compagnies as well: http://blogs.technet.com/b/microsoft_on_the_issues/archive/2011/09/28/our-licensing-deal-with-samsung-how-ip-drives-innovation-and-collaboration.aspx
This is absolutely hilarious. MS makes money out of android, while google barely makes anything from it. Of course, MS makes money from windows phone as well. We could see it as this: Android market share + WP market share = the money making market share of MS in terms of mobile OSes
Google makes plenty from data mining your info ;)
true dat
yet according to eric shmidt they arent crossing the line because they are offering a "free" OS
Eric Schmidt never met a line he didn't cross.
Eric Schmidt is a stupid whore.
We aintt..gooooooing nowheeree!!..we aint..goin nowhere!! We cant be stopped now!! We MICRO$oft for life!!!(^_^)
^THIS
MICROOOO$OOOOOFT BAAABY!
Hahahahahaha oh wow
What's the point of this article? It brings wpcentral down a few notches, and I thought this place was better than that. Seems sad and petty.
The point of the article? I would figure someone so high and mighty would be able to figure that part out.

The tone, yes, snarky. But so what, it's not your web site.
Hmmmm, "FinancialP"?
You must be an accountant for Google . . . (jk, jk!!!)
I like to read reviews, new app releases, good general info is here. Just seems like the author is promoting fanboys. Seems childish, and I just didn't realize this place was like that. I know the commentary people leave are childish, but didn't expect this.
Did your sarcasm meter break today? What about your funny bone? Lighten up :)
Definitely an accountant . . . lol.
Whether you promote them or not, fanboys will be there on both sides of the fence. The author might as well be able to have some fun with it.
Lighten up. Not everything you encounter in life will please you. The author clearly wasn't trying to stir up real controversy - they just relayed information while poking fun. People (men) have been comparing things since the first men starting urinating right next to each other under a tree. This is a way of life.
Lighten up Francis.
The butthurt is strong in this one
Lmao, I'll have to use that one.!
LMAO!!
You can try unclenching your ass from time to time.
Harmless fun: That's all it is. Now let me go find my Android loving, ad revenue generating friends to ridicule and abuse! ;O)
I really want to know how much more money MIcrosoft makes from Android than Windows Phone, if that rumor is even true. It would be interesting to see the statistics for that.
It is true, it can be seen on their financial statements, and there are various articles about it around. I'm on mobile right now or I'd link some numbers and whatnot.
Ah, now if you had been on a more mature and integrated mobile OS this fact would not have impeded your finding and linking the info... Just a suggestion.
More of 'cant be bothered without two screens and a mouse'.
Touché!
It's Ubuntu Phone for you then?
i wanna try bb10 and ubuntu phone and mozilla os. i feel that if market share is split 5 ways it would be better. just my honest opinion though.
I don't care how many ways it's split as long as there is a compatible architecture making life easier for app developers. ie Java and Linux for Android, BB10, Ubuntu and whatever Facebook thinks it's doing.
Don't be a dick. I didn't find or link the info because I was out and was being lazy. I would have left the same comment had I been using an iPhone, Android, or Blackberry.
Thanks for the honesty.
PS. Why so defensive? We're all just having a bit of a laugh. I've even got some friends who secretly like WP8.
so I shouldnt feel too bad because I'm giving up my 920 for a new S4?
Maybe. But maybe you should feel bad that you didn't wait for 2013 Lumia flagship that could possibly top the s4.
What do you mean "maybe", I think the word you were looking for is "obviously"
***Off Topic***
What deck do you ride???
downhill mountain bike.

also ive been with windowsphone since day 1. i still have my htc surround. so im allowed to be less than thrilled about where WP is at now and have stuck with my 920 despite being in the minority with battery and other issues. im hoping in 2014 nokia will be done with this current design and have something fresh.
Ahh. Sorry. I thought you were a fellow longboarder. Still bad-A though.
But I getting on topic, I've been with WP since launch myself. I had the Samsung Focus though. I like WP8 much better than WP7 though. Mind me asking what it is you find displeasing about the newest version?
Like your name suggests, you are heading the wrong way. ;)
LOL
LMAO
HAHA :D
PMSL
Like!
Why would you trade in your Lumia 920 for a Galaxy S4? With the Lumia 940 out Q4 2013, With Quad-Core Snapdragon 800 series (MSM8974/Adreno 330) which destroys the Galaxy S4 which only has a Snapdragon 600!
Because of the apps most likely...but who cares Microsoft gets paid either way
+1 on getting paid
In that case, I feel sorry for you. That is a major piece of shit.
I think we have to condemn MS on issues of performance and apps. MS can take WP to a higher level. So, what is keeping it down? I have always enjoyed wm6.5 phones than my hd7. WP8 is awesome but MS can do better
What's keeping it down? Resistance to change, the exact same thing that causes people to moan about Windows 8. People are still entrenched in their grid-of-icons mentality as it's something they've used in some form or other for the past twenty years or so, right from the early versions of Windows and Mac OS through PDA devices up to present day Android and iOS. Anyone prepared to invest as little as half an hour getting around Windows and WP should appreciate the quantum leap in usability and efficiency but, unfortunately, not many people are willing even to do that.
(I imagine that a couple of years down the line, Apple will "borrow" the live tiles concept, call it something catchy, make the design "shinier", then, without actually claiming as much, will convince the public that they invented it and everyone will marvel at how terribly innovative they are.)
That would be 29 years
Who cares if Microsoft makes more money on Android than Windows Phone. That's more money towards dominating Android from the enemy itself. More money for Microsoft and Nokia.
And that's one good point. MS raises funds through Android to develop WP as well as from the direct licenses of WP. You cannot imagine the amount of deals like this that the whole industry relies on. The article is just like some others: a curiosity; information; opinion.
If Foxconn really is paying MS for every single Android device, then this alone should bring enough money to develop WP. This plus all the other royalties MS supposedly is collecting from other Android manufactures should be more than enough to pay for ALL WP development. Even though WP is not selling, MS should spend every single dollar from these types of deals to pay off developers. Nothing wrong with that, especially if you want to be a player in this important market.

I guess may be MS is using up all this money by paying Nokia. ???????
The money, more than likely, goes to another division. Probably the Windows PC division. I highly doubt that the money collected from Android is going directly to the Windows Phone division. I could be wrong, but large companies tend to put the money in it's main bread winner, or spread it out over time.
I forgot to add something. I remember reading somewhere last year where it said that MS is not really making any money off of these deals. Apparently MS offers these OEMs rebates where they get some of the money back or something like that. Anyone heard of this?

I read these deals are just a way for MS to pound its chest and say, "See!! look at we're doing." But in reality, not much money, if anything, is made.
Look at MS financial reports they make plenty off these deals.
That's right, acting like Google now, making money off of everyone else
What? you mean to say acting like Microsoft making money off their intellectual property right? yeah thats what you meant to say :D. BTW your welcome for that correction.
You mean "you're" welcome. You're welcome for this correction ;)
Thank you my fellow Windows brother
Microsoft = winning.
i always knew this, but never knew how deep it was. Good for Microsoft.
Being a blatant capitalist, I think it's perfectly fine that Microsoft makes it's money of all available revenue sources. As much as I'd love to see both Google and Apple disappear from a tech perspective, money is money, and people are making a livelihood...I just want to see Microsoft making more of it than the other two.
ODM stands for Original Design Manufacturer. Also, I didn't realize Foxconn designed the products they build for other companies. Do they?
You are right. Brain fart on my part. Thanks.

Annnd.... I'm pretty sure they don't actually design the products, just produce them.
Then they aren't an ODM. I think they might rightly be called an OEM, but even that is confused terminology. Oh well. :)
They do have basic designs that company can pick from they do offer design services as well they were on something like 20/20 couple years ago
This is like one of those master moves you pull in a game of Monopoly; before you realize it, all other players are tossing money at you. Genius
Didn't Microsoft's stock just get downgraded because the PC is "dying" *cough*yearight*cough*. I guess they didn't take into account ALL the financials, did they?
This is what happens when a company can innovate fast enough..they litigate for some spare cash to hold them over til they actually make some money off their products.
No, this is what happens when a large company figures out a way to completely circumvent the entire patent system by "giving away" a product that is built on the ideas and hard work of others. The "others" are fully within their rights to reclaim their revenue downstream, which is the only option left available to them.
^THIS poddie
"Microsoft's Android licensing program" I never thought I'd hear those words together. Lol
Microsoft may not have google(android) apps, but we have google's(android) money. I'm surprised microsoft didn't throw app support into the deal.
Its not really related to the devs on play store... Its about Android devices itself
This is good to see! Great to see they aren't doing an *ahem* Apple, and suing everybody for designing a phone like a phone! Rectangles are owned by Apple?
Sometimes i wonder why MS keeps going after Android and I don't think it all has to do with the smartphone wars.
One part business model I believe. Google and Microsoft is so completely in different camps. Remember Android is basically Googles way of saying, "-we don't charge for it so you can't sue us. All of cause a grey area, but a morally wrong way of doing business.
I support the way Microsoft is thinking because we all like to have jobs and get payed a salary at the end of day. If you created something its yours to monetize.
Now one could argue MSFT being the right company being the owner of a lot of technology, after all they never really managed to get complete and bug free products out the door.
Every company releases products that are incomplete and with bugs. In fact, I would wager that every electronics product by every major manufactgurer is in some way "incomplete" and has bugs in it. Microsoft does it no more than anyone else. Any significantly complicated piece of electronics or software will have bugs. It's not a sign of laziness or incompetence, it is an unfortunate reality.
Kinda funny, cause those patents are only valid in US
I'm one of the Microsoft fanboys he was talking about! Microsoft for life
The wonderful thing about this arrangement comes down to the motivation to succeed. Microsoft MUST succeed, its future depends on it. It's late to the game, so failure is not an option. Android OEMs are simply riding the current wave of popularity, and their loyalty ends when the dollars do and/or when the risk escalates. Should Microsoft, an already cash-rich company with a long-term plan, use the proceeds from its Android gains to continually improve the Windows Phone experience, they'll end up with a product that is unparallelled in every respect, and one that will leave Android OEMs in a financial dilemma. Google, meanwhile, may tire of lining Microsoft's products, or the problem may be solved for them as more and more Android OEMs decide to fork the OS, e.g., Samdroid.
I hate this. I imagine the patents are laughably common uses of technology. Also, how can you sue the brand (like HTC) for using the technology *and* sue the ODM for the actual manufacture?? They just build from the specs. Surely the brand makes sure that it's licensed.
Is it not better for WP8 improved rather than arguing for Quad cores, 1080p e.t.c?
i would like Nokia & Microsoft to work on:
1) more FPS (e.g. 60 frames per second)
2) those request on their windowsphone uservoice website.
Wait, Microsoft actually makes money from Windows Phone?
Haha, lol.
MS is already getting royalties directly from Google too, per Android device sold
Source?
Perhaps it's more important to note that it's not just Microsoft which makes money out of royalties like this because of patents that it owns through Foxconn or any other entity for that matter. It's pretty obvious that there are other companies which own their own patents and make money through royalties in their own ways as well. If more of such lame, baseless and inappropriate articles start surface on this channel, perhaps it's time to stop following it.
Haha...wow...making money however they can.
Aside from that point...I hope Windows Phone stays around for a very very very long time no matter how popular the OS gets! I'm content with it being in third place as long as it stays around and keeps developing new updates and new hardware to go with it (no matter how "slow" in some peoples opinions those updates and new devices may come out)...
The people who, you know, make these phones aren't going to be content with it being in third place (it's fourth actually).
Hopefully that discontentment doesn't cause them to abandon WP altogether...
well its in third in the USA
Thought so!
Are you saying that MS makes more *per device* from Android than Windows Phone, or that they make more money from Android overall because android sells so many freakin' handsets?
Overall.
Thanks for it, now all upcoming Android and Chrome OS devices are a bit pricier!
One can argue that the prices used to be artificially (and illegally?) lower because of the theft of the IP that MS is now getting royalties from. So the new price is actually a more honest price for what it costs to deliver the device.
Now put that money towards making WP even better along with more marketing.
It is probably a very small amount because almost everyone company is swapping patents, and apple and Samsung make huge profits on there phone, Microsoft only makes the software and Nokia is making money. Samsung get basic android for free...and apple makes software and hardware....oh and Samsung also owns alot of the factories that produce there parts also...so Microsoft would still be behind in smart phone profits
Haha. As long as wp is working smooth, I don't care about android's popularty.
Foxconn is that company you heard about a bit in the news last year over some working conditions for Apple products. However, Foxconn makes products for more companies than just Apple. Foxconn is an original design manufacturer (ODM) for big names like: Acer, Amazon, Cisco, Dell, Google, Microsoft, Nintendo, Sony, Toshiba, and more.
Why are we glossing over the fact that Foxconn is a terrible, terrible place to work? "Some working conditions for Apple products," is perhaps the most sterile way of speaking of conditions that were inhumane and took of advantage of and forced people to work long hours for little pay to the point where a few tried to commit suicide. Oh, but wait! Lots of other big name companies use them too! So it is okay! Does line of thought even make sense? I personally would be happier if Microsoft stayed away from money made from such situations (and I am a Microsoft fan, so don't think that I am anti-Microsoft). This is about big companies making money from poor workers who are worked beyond their limit; isn't that something more to be concerned about than having these comments be a place where fanboys can hoot and holler?
Sorry Microsoft, I use Samsung, android, Linux. Screw you.
So what you're saying is that you're paying money to Microsoft for every device you own? ;)
This is why when Ubuntu phones come out, iOS & Android will die (maybe MS as well :))
i just hope Microsoft doesnot get too complacent..window phone has long way to go!!!
We need to stop patents and stop selling them to other wise we will be in what future generations call the "stone age" for a long time.
Yep. Nothing jumpstarts progress like telling the best and brightest innovators that they can't be paid for their work.
if you cant beat them!!! USE THEM!!!!
This made my day. Thanks bro or is it sis?
why is there a picture of Samsung, I don't think foxconn makes products for samsung.
Talk about getting to the root of the problem, the mass manufacturer of just about every electronic device.... I really wish Nokia went with an AMOLED display, it just looks cheap next to that Vibrant display of Samsung's, heck I sorta preffer my 900's vibrancy over the sharpness of my dad's 920.

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