Microsoft seeking $15 per Samsung android smartphone sold- Is it cashing in on Galaxy SII success?

Microsoft is a very wealthy corporation with assets worth billions of dollars. And that means that the company has a steady income, some made by the company itself and others from patent rights.

Well, if you did not know, Google uses some of Microsoft’s patents for the Android platform. But since Android is an open source platform, the smartphone manufacturers are the ones viable to pay royalties to MS.

Companies like HTC, LG and a bunch of other major brands are viable to pay a certain fee with every Android smartphone sold under their belt. Nobody has the proper estimation of numbers so far, but some reports in the past have suggested that HTC pays Microsoft $5 per Android smartphone sold. That isn’t much really given the profit margin that the manufacturers have with every handset.

What’s surprising though is the amount MS is asking from Samsung. According to a publication from Korea, Microsoft is demanding a whopping $15 per Samsung Android smartphone sold. Seems a bit much doesn’t it? Well this indeed looks like MS’ way of asking Samsung to pay more attention to the WP7 platform.

There are a couple of Samsung WP7 handsets out there like the Omnia 7 and Focus, but MS doesn’t seem to be impressed. Samsung obviously will be looking to pay something less than $10 and launch a new line up of WP7 handsets to keep Microsoft happy. If Samsung were to pay $15 per Android smartphone, then MS wouldn’t have to worry about WP7 since they will be making millions of dollars with a couple of Android handsets.

The Samsung Galaxy S II is doing very well in the market and Microsoft could be looking to take advantage of this. If we calculate the approximate sales numbers of the Samsung Galaxy S and its successor the GS2 and multiply it by $15, it comes down to about $195 million.
And that is only two handsets out of the long list of Samsung Android handsets.

Microsoft could actually make more with royalties than with WP7.