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Jul 14, 2011

Can Microsoft generate more revenue out of Android than Google?

Some of you may have already noticed the patents war is getting very interesting lately especially in the mobile area.

I just finished reading a brilliant article over at TechCrunch that talks about the things that are happening behind the scenes, and while Android is practically everywhere, activating over 500,000 new devices every day(!) – giants such as Apple and Microsoft are already taking a deep bite into Android revenues from Google partners, with the potential to generate more money out of it than Google itself (in addition to Microsoft generating more revenue out of Android than from Windows Phone… ).

Here are some quotes I really liked:

"Since Microsoft has the rights to several patents related to technology used in Android, it has been able to turn Android into a huge revenue generating business by entering into patent licensing agreements with other companies which produce Android devices. Microsoft recently entered a patent licensing agreements with several manufacturers including HTC, General Dynamics, Wistron and Onkyo under which they will pay it $5-$10 for every Android device that they ship. With 500,000 devices a day, this implies around $1 billion in value if it received a $5 fee for each Android device. Current negotiations with Samsung, the top Android device manufacturer, could land Microsoft an additional $10-$15 for every Android device activated by Samsung."

(Source #1)

"Microsoft’s intent here is pure evil genius. “It’s not like Android’s free. Android has a patent fee. You do have to license patents,” Microsoft CEO Steve Ballmer said last year. What he didn’t explicitly say is that you’d have to pay Microsoft and not Google for those patents. Think about this for a second: it’s entirely possible that Microsoft is going to end up making more money — perhaps significantly more — from Android than Google will. A year ago, such a statement would have seemed like a joke. But now it’s becoming reality. And it must be the ultimate nightmare for Google"

(Source #2)

The argument around the patents rights has started another thread of criticism against Android – this time about the lack of innovation, mainly in the user interface (which is one of the reasons I don't use Android).

So that adds yet another complaint against Android. First there was the inconsistent UI and general glitches, then the apps quality problem (having too many ringtones, themes, skins and low quality apps…), and now – lack of innovation. Boy it's hard to be number #1…

Personally I do agree with the criticism but not with all of them; while there are some innovative concepts Android created around the core functionality (such as multi tasking and synergy between apps and data), my general impression of Android (which doesn't change over time I must add, even though I'm constantly trying new leading devices) is that it is the new generation of Windows Mobile with some attempts to be sexy as the iPhone with a lack of one concrete theme or specific design principals that will create the usability experience people expect from a smartphone these days.

And a word about Microsoft: Now that Nokia will bring more money out of WP7, and and Android will also become a revenue engine (still feels funny to write it..), how about BlackBerry? Buying RIM (with the money Android makes, that is…) will practically complete this twisted path into becoming number 3, don't you think? Well, maybe not…

You may also want to read the following: Can iPhone generate more revenue than entire Google? | Microsoft Makes 5 Times More Money From Google’s Android Than It Does From Windows Phone 7



3 comments:

Jmp9 said...

Google should start thinking about users instead of spamming the world with their ads.

Android sucks, you cannot do with it half of the things you do with an iPhone.

When iPhone 5 will be out that will be the end of Android.

Anonymous said...

"Android sucks, you cannot do with it half of the things you do with an iPhone."

have you ever used an Android for more than 5 minutes ? for having booth, Androïd is way more flexible than iphone. the iphone can feel more easy but simplicity is at the cost of powerful features.

"When iPhone 5 will be out that will be the end of Android."
At this moment, there is 2 Androîd in the world for 1 iPhone and they are selling at 550.000 Androïds per DAY !!!

so, let me doubt the iPhone 5 will reverse that.

This is FACTS !

Have a good night ;o)

Jmp9 said...

I am looking for the best product - not the most flexible one.

They are activating 550,000 Androids only because the price is so low. You buy one, and get the second one for free...

Android = Symbian

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