Microsoft Takes Six Billion Dollars From Android

By Ewan Spence

A long time ago, Microsoft MSFT +0.00% purchased Nokia's Devices and Services division. In the period between the deal being announced and the deal closing, Nokia’s engineers pushed out one last hurrah. The Nokia X range of handsets, powered by Nokia’s own fork of Android, tied into Nokia’s ID system as well as Microsoft’s nascent cloud services.

The specifications placed the handsets in the budget and mid-range market, so we never got to see a full-throttled Nokia Android platform, but I like to think that Finnish engineers were happy to get the chance to show what they could have done had Nokia made a different decision on February 2011 instead of announcing its adoption of Windows Phone.

As the deal closed, it left Microsoft CEO Satya Nadella with a question… would Microsoft pick up the challenge of Android or would the Nokia X be left behind in a metaphorical Finnish limbo? The focus went to Windows Phone, and the upcoming move to Windows 10 across the full portfolio, and Nokia’s Android present was left on the doorstep.

If we smash cut to the present day, Microsoft’s Windows 10 move is under way with the desk-bound computers, the Surface hardware now on the updated operating system, and Microsoft is as far away from manufacturing and distributing its own Android device as… well… Apple AAPL +0.82%. Why would it want to, when it has the Android platform where it wants it?

Financially Microsoft is one of the biggest winners from the growth of Android as a platform, thanks to its wide range of patents. Samsung’s royalty payment to Microsoft in 2013 was for over one billion dollars ($1,041,642,161 and fifty cents), roughly $3.41 per device. With roughly 300 million Android handsets sold last quarter, that could be another billion coming to Redmond.