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Big Android profits subsidize Microsoft's Windows Phone efforts

News by Andrew Kameka on Thursday November 07, 2013.

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It's no secret that Microsoft makes more money from Android than it does from its own Windows Phone. After settling patent disputes by forcing almost every Android manufacturer to pay a royalty fee for each device it sells, the company is generating billions of dollars each year. Microsoft earns more than $2 billion, according to Nomura analyst Rick Sherlund.

Microsoft has never directly confirmed the exact amount of money it gets from Android vendors, but widely-reported licensing agreements and sales estimates for Android devices makes it possible to get a ballpark figure for how much the company earns. It's all free money for Microsoft because it doesn't need to do anything to get it aside from administer its patents and monitor that licensees pay the correct amount.

Sherlund then points out that Microsoft uses the $2 billion it earns from Android to offset the money lost from the division that includes Windows Phone and Xbox. Though Microsoft may take a long time to spark any major change and increase Windows Phone's market share, the company has all the time in the world to make that happen; Microsoft will make money with minimal effort so long as Android remains successful.

source: Business Insider

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Andrew Kameka
Andrew is based in Miami, Florida.

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