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HTC pays Microsoft $5 for every Android phone

According to a Citigroup analyst report, phone maker HTC is paying Microsoft $5 for every Android smartphone that is made. Apparently, this fee is a result of a settlement reached between Microsoft and HTC over patent claims.

As The Seattle Times reports, a report was released today indicating that HTC was paying Microsoft $5 dollars for every Android smartphone made as a result of a lawsuit settlement reached on April 27. Microsoft has also sued other manufacturers who make Android powered phones or devices. This is interesting as HTC not only makes Android phones but also Windows Phones.

“Our understanding is Microsoft is looking for a $7.50 to $12.50 per unit license to settled alleged infringement of Microsoft patents,” the report said. Apparently, Microsoft wanted HTC to pay more money, but settled on $5 per unit sold.

“HTC and Microsoft have a long history of technical and commercial collaboration, and today’s agreement is an example of how industry leaders can reach commercial arrangements that address intellectual property,” said Horacio Gutierrez, a deputy general counsel at Microsoft.

So just how much is Microsoft making from this settlement? HTC has shipped approximately 30 million Android devices to date and this alone means Microsoft earned $150 million dollars.

Now here is the best part. Microsoft has made more money from Android than Windows Phone. Windows Phone licenses run about $15 per device. With two million units sold thus-far, Microsoft has made only $30 million.

Microsoft declined to comment on the report.

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