Microsoft Strong-Arms Another Android Licensing Deal
Microsoft announced on Monday that it had convinced yet another company to sign a licensing deal to cover Android wares. General Dynamics Itronix will be paying the folks in Redmond an undisclosed sum to ensure "broad coverage" of Microsoft's patent portfolio for future Android devices the company wants to create.
General Dynamics Itronix makes ruggedized notebooks, netbooks and even a tablet, using mostly Windows software. But clearly it is eying the ultra-hot Android market for new products.
This is, arguably, Microsoft's third publicized Android licensing deal. The biggest was the HTC deal, signed in April, 2010. The first was, perhaps, a deal with Amazon in February, 2010. Amazon agreed to pay Microsoft royalties to cover a range of Microsoft intellectual property, including, some speculated, the use of Android on Amazon's Kindle. The deal also covered Amazon's use of Linux on its servers.
Linux and its derivative, Android, seems to be turning into a profitable business for Microsoft. A recent analyst report indicated that Microsoft is making a handsome $5 per HTC Android device sold. And that means it is raking in far more money on Android than it is on Windows Phone 7 (which reportedly costs about $15 per device license). However, the idea here isn't really to make a killing on Android, which is nice for Microsoft and all. The idea is to keep Android from being a free alternative for device makers. Microsoft CEO Steve Ballmer said so to the Wall Street Journal in October.
By the way, these aren't the only licensing deals that Microsoft has pulled off regarding Linux. In addition to the Amazon deal, Microsoft scored an early Linux cross-licensing agreement with LG Electronics and a few others, such as a deal with TurboLinux.
Meanwhile, Microsoft has launched lawsuits against Motorola and Barnes & Nobile to try and collect royalties from their use of Android, too.
Until Linux and Android, it was rather rare for Microsoft to initiate a lawsuit over IP infringement. Microsoft was previously more often the deep-pocketed victim of such suits, not the instigator. About a year ago, when the company sued Salesforce.com in May, 2010, Microsoft had only filed four patent infringement lawsuits including that one in its entire hitsory. (Salesforce.com and Microsoft eventually settled).
But hey, Microsoft seems to be changing its mind. If you are the world's largest software maker sitting on a boatload of cash and you can't beat 'em, you can at least try to profit from them.