Microsoft is Cleaning up on Patent Licensing Fees, Might Have Lassoed Motorola
Microsoft (NASDAQ:MSFT) has entered patent licensing deals with almost every major Android device manufacturer, including Samsung, Quanta, HTC and others. Motorola (NYSE:MMI) is one of the few Android manufacturers that hasn’t yet licensed patents related to Android from Microsoft, which is likely due to the fact that Google (NASDAQ:GOOG) recently acquired them. However, Motorola may be forced to enter a patent licensing deal with Microsoft soon. Microsoft had filed a lawsuit against Motorola alleging patent infringement, and it recently won an initial ruling by the International Trade Commission, which stated that Motorola did infringe on one of Microsoft’s patents. [1]
Check out our complete analysis for Microsoft
Microsoft could generate more than a billion dollars in patent licensing revenue from Android
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Google’s Android is now the most popular smartphone platform globally. Andy Rubin, the division head of Android, recently announced that more than 700,000 new Android devices were being activated every day by users around the world. [2]
Each Android device sold by manufacturers who have licensed patents from Microsoft generates close to $5 – $10 in licensing revenue for Microsoft. We expect Android patent licensing to generate more than a billion dollars in revenue for Microsoft in 2012, but it will have only a marginal impact on Microsoft’s $32 Trefis price estimate, which stands nearly 20% above its current market price.
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