Jul 06 AT 11:01 AM Edgar Cervantes 39 Comments

Microsoft demands $15 per Android handset from Samsung

While the mighty Apple vs. Samsung war rages on, our loyal Android manufacturer is being attacked by yet another technology leader. Microsoft is demanding Samsung hand over a $15 fee per Android device. Microsoft owns an extensive range of patents being used by Google’s Android OS and request that they are credited (financially) for their ownership.

Samsung will probably have to give in to Microsoft’s request, as did HTC. The difference is that HTC is only paying $5 per Android smartphone, while Microsoft is asking Samsung for triple that amount. HTC and Microsoft have displayed a long partnership in the Windows Mobile platform. This may be what led Microsoft to request a smaller fee from HTC, and that is a privilege that Samsung is trying to attain.

Instead of trying to fight Microsoft (or just give up and pay the fees), Samsung is trying to barter with Big Brother Microsoft. In an effort to lower the $15-fee, Samsung is asking Microsoft to loosen its chains and allow them to pay a $10 fee per device instead. As an incentive, Samsung would commit to create a stronger alliance with Microsoft’s Windows Mobile OS.

For an Android enthusiast, it’s definitely painful to see some of the favorite manufacturers being legally attacked. Such is the case in today’s world, though. Companies (many of them with a bad case of over-entitlement) are suing each other for unreasonable matters. It sure must be tough for Samsung to go up against both Apple and Microsoft!

These companies can probably afford to hand over their cash here and there. But Microsoft trying to influence Samsung’s productions of Android devices over patent fees is simply unacceptable. If Samsung does commit to get more involved with the Windows Mobile platform, it would probably mean Android manufacturing will be affected. Unless Samsung decides to just release more handsets than they normally do.

Microsoft has recently made deals with Nokia in an attempt to raise Windows Mobile and make Microsoft’s Mobile OS a stronger competitor against Apple and Google. Given that Microsoft has plans to work closely with its new best friend and charge other manufacturers to use its OS, it does not seem likely Microsoft will easily agree to Samsung’s offer. Time will tell what is in store for Samsung’s deals with Microsoft, but things sure don’t look promising. What do you guys see Microsoft doing in the near future? Do you think Samsung will get away with the $10-fee? Do you think Samsung’s Android handset production will be affected by this?

Via: Android Central

Source: Reuters

Hello, I am Edgar Cervantes. I am an avid Android fan, and keeping myself updated on the topic is part of my daily life. I will always work hard to give the best of me to our community of Android enthusiasts, and I am very honored to be part of this ship. Hopefully we can all enjoy sharing our knowledge and opinions!

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  • http://Website Erfs

    Thats insane. What exactly is/are the parents microsoft is claiming? How come they don’t sue google? Do the parents cover after market stuff that the manufacturers are adding into vanilla android?

  • http://Website j

    They’re playing poker. Ms won’t say what the patents are…
    They don’t sue Google because they’re scared to do so… And google never gives in, they fight back.
    This way MS hopes to scare all the other companies into being affraid of making android phones.
    I have lost all respect for MS.

    • http://htcsource.com Nick Gray

      Microsoft is not playing poker at all. They have a long history of patent claims within the Linux realm. I’m not sure what the Samsung deal is about, but HTC’s deal is a lot more than just a flat fee on every Android phone they push out. The Microsoft/HTC agreement “provides broad coverage under Microsoft’s patent portfolio for HTC’s mobile phones running the Android mobile platform.” http://www.microsoft.com/Presspass/press/2010/apr10/04-27MSHTCPR.mspx

  • http://Website sam

    This whole thing is pretty awesome for Microsoft lol..I wonder who makes more money per handset: MS or Google?

  • http://Website Deter

    Android phones from Samsung retail for $450-$500. So the providers are paying Samsung $375-$475 for the devices. Of that i’m guessing about $300 if not more is profit.

    If the company that owns the patents on the software that runs your phone and makes it worth buying is adking for 5% of that (which is less than sales tax on the item) I think it’s a small price to pay.

    • Deter

      That being said, i still think its a bitch move by MS to try and get less android phones made. The point i think MS is missing is that less android phones will not mean more people buying Windows phones. They will go back to their blackberries and iphones.

      • http://Website Semajhan

        I’m pretty sure people won’t be going back to blackberries.

    • https://plus.google.com/117702410245683101961/posts Lucian Armasu

      What if other patent trolls like Lodsys start charging 5%, too? Just because it’s a small amount, doesn’t mean they should pay, especially if the patents are too obvious. Samsung should take them to court and invalidate them.

      That’s actually what all patent trolls do. They ask for a “small enough” fee, just so they make sure they pay, and don’t bring them to court. And a lot of little guys fall for it, because they can’t afford to bring them to court. But Samsung can do that.

      Microsoft is acting just like any other patent troll, asking for their “protection tax”, else!

      • http://htcsource.com Nick Gray

        I know the patent system in the U.S. has a lot of flaws, but this is actually where the patent system shines. Patent holders has demand that no one use their patents (Apple) or they can ask they you license them for a fee (Microsoft).

        If you came up with an idea that no one else thought of, wouldn’t you want compensation for it? Profits are the main source behind innovation.

        • http://Website David Guest

          Except Apple and Microsoft didn’t invent anything. They patented really obvious things that allow them to block real innovation. The Linux patents that MS claim are bogus – if they really thought they had a case they’d sue Google and not just for Android – most of Googles infrastructure is linux. I used to defend MS in the early days but they’ve shown their true colours – zero innovation, sub par products, no direction and a reactionary business plan. oh and ditto that for Apple.

    • event

      Haha, yeah right man. $300 in profit for Samsung? You really think it costs so little to make a phone?

  • http://maxtechnewz.blogspot.com Max

    that means that their might not be no galaxy s 2 :- (

  • http://Website schwiz

    when I saw the headline I was excited. I thought oh finally someone who will fight back! I am disappointed Samsung took this laying down. There is no way M$ should make more money off of android and Linux than it does from its own platform. I wish someone would challenge and set a precident possibly get some of these patents invalidated.

    • http://Website themanwithsauce

      I see an “out” for samsung here. They’re under attack by two companies simultaneously. All 3 involved are competitors. IF samsung sides with one, then they could hide under that patent umbrella while google readies theirs. But if they try and drag out this fight, they could lose a lot of money in legal fees and not end up winning either case. I don’t like to see it but they might be playing the safe bet to get themselves by for now. Apple wouldn’t fight Samsung if both MS and Google are behind them. And MS wouldn’t take on Apple and Google. And Samsung can;t afford to snub the Android platform due to their wild success.

      Corporate politics create some interesting bedfellows sometimes….

  • http://Website microcrap hater!

    This is complete and uttered crap! Take a stand samsung or I will be leaving your phones behind too! Microsoft is getting rediculous with this crap!

    • http://Website Tony

      They have to do something.. since nobody is buying WP7 devices ;-)

  • http://Website Amiga to MS to Linux to Android Convert

    If the Android OS does indeed infringe upon Microsoft’s patents, then Google is the guilty party and should be attacked directly by MS. I cannot blame MS for trying to protect their intellectual property. What I do not understand is why MS is going after the handset manufacturers. Would Apple sue Dell if Windows 7 infringed upon Apples patents?

    • http://Website sri

      The terms in usage of android says that the OEM’s are responsible for everything and not google.

  • http://Website mesasr

    ahhh,I like this site a lot and it was painful to see a couple of MS vs Android articles childishly calling MS(and Nokia) outdated and a patent troll without making any sense or trying to understand the case,
    but now finally a logical article with the understanding that if the likes of HTC eventually made a deal with MS then it actually means their patents are indeed real and not some BS like in Apple’s case

    as an Android fan(who at the same time likes and respects MS) I blame only and only Google for failing to buy some very valuable patents recently in order to defend its hardware partners, and even if they thought the price was too high for them($4 billion or so) and the chances to beat that Apple-MS-RIM consortium alone were low then they still could ask big partners and potential victims like Samsung and Motorola for some help, but that didnt happen so now they must either pay much more and buy RIM(highly unlikely) and share some of those patents or just sit there and watch a rival collecting money from its partners

  • https://plus.google.com/117702410245683101961/posts Lucian Armasu

    Samsung should immediately cease making any other Windows devices, or at least the WP7 phones. They should not give in to Microsoft, but fight against them like B&N.

    • http://Website RaptorOO7

      Amen, Samsung should jettison MS mobile OS out the window, focus on Android and selling their chips and displays to other smartphone mfg’s. Why offer MS more devices, they clearly think Nokia will save the day. Exactly how MANY Nokia SmartPhones are subsidized by the Carriers in the US and I mean real Smartphones like the N8, N9 etc.? I really can’t think of any, ok, maybe 1 or 2.

      • http://Website Exynos

        I’m personally a huge fan of samsung and think they should make a deal with microsoft ! No one seems to realize why they are doing this deal! The patent is related to android! Which means the $10 or $15 per phone would only be on android phones. So if they make this deal it allows them to make wp7 phones that are good and still make android phones without losing profit or causing a price hike in galaxy s 2 etc.

  • http://Website Leanne

    Okay there’s something I’m not understanding (I just didn’t research it :P) why is Microsoft demanding it?

  • http://Website KaLanGO

    This got to be a bad joke. Samsung just stand and try to come up with a better “price”. I wonder how long google will stand to it. Also if someone had to charge $ for android it would be oracle, who claimed that Dalvik stole their pockets.

  • http://Website androidfan

    That makes me more angrier…fuck you microsoft. I really love windows seven but i am not buying it!
    Although i will use it.
    When microsoft takes $15 per phone I will be taking $1000 downloading win 7 from pirate bay.
    Also fuck you steve

  • http://Website vasra

    $15 a pop?

    Fat chance.

    They’ll be lucky to get $7. $5 is more like it.

    Still, this is what the the next generation of mobile system ecosystem battles will be fought on : patents.

    The losers will try to fight back the winners via patent portfolios.

    This will make phones more expensive and delay releases.

  • http://Website androidfan

    Just don’t buy anything microsoft. If you love windows then pirate bay is a great source.
    BTW: fuck you microsoft!

  • http://Website abdullah

    MS move is not really that much surprising. They have already lost the smartphone market share to Google, Apple and Blackberry. So this is their easy way out, one of them. Sit and make money from others sales. Sure they call it legal.
    When Vista bombed, MS tech stated ‘we are doing our best to minimize the problems’. This was in PC World back then. Apple always worked to terminate problems.
    It is obvious that time has finally taken its toll on the efficiency and hard work spirit of MS guys. Any easy money is welcome to keep them going.

    It is not easy to admit that your product has lost its charm. If android phones output falls, people will still not buy Windows mobile but iPhones and BBs.

    Microsoft really should focus on bringing charm back into its own mobile OS than play such pathetic games.


    • http://Website RaptorOO7

      I agree, except on one item. Apple has become lazy and doesn’t care about their QC anymore. Their stance over the last few years has gotten worse and worse. Ignore the problem and it will either go away, or the angry mob will get loud enough we will actually have to address it. Of course then Jobs comes out, tells everyone you are holding it wrong (gee Job’s you were holding it that way on stage) or that Mac’s do not get viruses or malware (they do get malware now).

      I have a Mac, so does my wife. We both run Win7 on our Macs, and OS X Snow Leopard (soon Lion). If I could buy a white box PC and run parallels with the OS X on it I would. Apple’s hardware has gotten more expensive with little “real” upgrades. They keep graphics card memory low, over charge for memory upgrades and of course include (2) 1GB RAM instead of (1) 2GB RAM so you could easily upgrade it yourself.

      Now you can’t even take the battery out, you have to send it in for upgrade time and be without it for a week or more. Way to go Apple, making hardware more difficult.

  • http://Website Maximus

    The Real War is in the PATENTS

    Not only in the Technology Sector but in Black Ops

    This is where the future will be fought

    Who controls the Patents can dictate and Steer development in any which way they see fit

  • http://Website RaptorOO7

    It’s time to overhaul the USPTO, the 10,000 monkey’s banging on keyboards have done little more than rubber stamp claims that were total vaporware when they pulled it out of their butz, and now they are common place ideas.

    Congress of course lacks any real concept of how to manage the USPTO, simple solutions I have heard is all them to keep all funds generated for patent filings so they can actually afford to properly review all patents that come in especially the apple patents that use (steal) prior art.

    Microsoft is a little bitch who can’t get their own crappy products out the door so they suck off of the companies that can. Really paying Nokia Billions to get them to switch their OS, do you think all of Europe is going to keep on buying Nokia phones running a MS OS? I doubt it.

    Its time Google and the Android Partners come together as a collective group and respond in kind to Lodsys, MS, Apple and many others on these absurd patent claims.

    Apple is clearly scared of what Samsung has built and their only response is litigation and lying to the judge about their so called “high level talks with Sammy” to resolve their legal issues.

  • http://Website Leech Hater

    Behaving like leeches, sucking others for your failure to perform, while you, MicroSoft. sits idly back on your fat backside, and live off the sweat and hardwork of others, is damn unethical and shameful.

    Don;t expect users and buyers to respect or admire you. We know leeches when we see them. My friends and I will never buy anything MicroSoft again.. Open Systems, Android and Google, already provide us with all the needs that we require in these days and age of the Internet world.

  • http://motorolatriumph.info Rock That Motorola Triumph

    That has to be the greatest picture – the eyes freak me out! They should tell microsoft to go make their own phone as kick ass as the Android.

  • http://Website rovex

    While i dont like patent trolling of any sort i still prefer Microsoft’s methods to Apple’s. Apple are true trolls in the worst sense and dont want money, they want patent deals and selling bans.

    Microsoft’s patent claims seem to be (from what i can tell) genuine technologies, Apple’s are more concepts and methods. Apple are the real bad guys in the patent war.

  • http://yohanesmario.com Mario

    Microsoft is plain dumb. WP7 is a total fail, that’s why they are trying to attack Android supporters.

    Microsoft claim that Linux has violated 235 of its patents. However, they never reveal which patents are really violated. So, it’s possible that they are just trying to mess with the open source community.

    I was a happy windows and MS office user, but now I see the bad side of microsoft, and I’m happy to have make the switch to Linux from a long time ago, although not completely.

  • http://sean-the-electrofreak.blogspot.com/ Sean the Electrofreak

    Really tired of the patent system handing out patents for “The Wheel” so to speak. Patent wars would hardly exist if the patent system was a little bit more restrictive in the scope of the patent.

    M$ is milking it for all it’s worth…

  • 420speedwagon

    screw microsoft!!! there OSs is crap and demanding that manufactures pay them for someone elses work is even more crap!!! IMO i thing microsoft was better when Gates was still in charge.
    but question. is this grounds for google to sue microsoft?

  • http://Website Dallas

    The only option Samsung( w/146 billion dollars) and Google( w/75 billions dollars), to team up and buy Nokia and their patent for 10 billion dollars and make their money back on fees.. and put MS and Apple out of the mobile business, since they own most hardware R & D; they need to be aggressive towards apple and MS.

  • http://Website Nam

    Microsoft and/or Apple don’t want a direct confrontation with Google, its a bad move since the companies often work together on things. So instead of attacking Google directly they go after the handset manufacturers.

    That’s why HTC gets sued and not Google.

    Also, the Microsoft patent claim asking for $5-15 per device isn’t ALL bad. HTC was getting sued by Apple for much more and MS stepped in and made the $5 per handset deal, thus giving HTC legal right to the MS patents and thus stopping Apple from doing anything more serious. Both MS and Apple own touchscreen patents, its all very complicated.