When Google announced Android back in November 2007, many thought that the introduction of a free open source operating system that would be maintained by one of the world’s most innovative companies would completely disrupt the wireless market. Any handset maker looking to trim some fat off their spending could just use Google’s software and build a device that most people will flock to since they live their lives in Google’s cloud. Here we are, 4 years later, over half a million Android devices being activated daily, and Android’s not as free as people has hoped. The patent wars that have taken place over the past few years have made it virtually impossible for someone to use Android without getting sued. Then there’s Microsoft, who instead of taking people to court, has simply been signing licensing deals while also letting companies know that if they went with Windows Phone, they wouldn’t have to be dealing with this bullshit. A total of 8 companies (Acer, General Dynamics Itronix, HTC, Onkyo, Samsung, Velocity Micro, ViewSonic, and Wistron) are now paying Microsoft an estimated $3 to $6 per Android device they ship. That’s lead analysts at Goldman Sachs to come up with a startling figure: $444 million. That’s how Microsoft expects to make, every year, off Android.
Does Microsoft make more money from Android than they do from Windows Phone? Horace Dediu, an independent analyst/blogger who’s widely read and admired, said in May that yes, it does appear that Google’s indirectly helped Microsoft’s bottom line. The bigger question for Microsoft is when will Windows Phone actually take off? The world is waiting to see the first Nokia Windows Phones, and luckily for them the wait isn’t going to be all that long. Nokia World is scheduled to take place in about 3 weeks. It’s expected that all be revealed at that event.