How much did Microsoft pay Nokia NOT to choose Android? How about a cool $1 billion!

How much did Microsoft pay Nokia NOT to choose Android? How about a cool $1 billion!

Summary: According to Bloomberg, Microsoft will pay Nokia more than $1 billion to promote and develop Windows Phone-based handsets.

SHARE:
119

According to Bloomberg, Microsoft will pay Nokia more than $1 billion to promote and develop Windows Phone-based handsets.

The agreement for the more than billion-dollar payment was part of a campaign by Microsoft to keep Nokia from choosing Google's Android operating system, one of the people said. Nokia also opted for Microsoft because Windows Phone software, which is newer than Android and has a smaller number of handsets for sale, gives Nokia a better chance to stand out, one of the people said.

You read that right - $1 billion. That's how much Microsoft wanted to avoid Nokia going with Android. And given the numbers involved, it seems that Microsoft really was desperate to prevent Nokia from adding to the ever-growing popularity of Google's open source platform.

No wonder Nokia was ready not only abandon its own Symbian platform, but also shun Android and go exclusively with Windows Phone. While Nokia has been at pains to emphasize that Windows Phone will be its primary smartphone platform, but it's hard to see Symbian lasting long given the competition, so it's fair to say that Nokia has turned itself exclusively into a Microsoft OEM. And that's an unusual thing for a smartphone maker. While LG, Samsung and HTC and so on have Android and Windows Phone (and a smattering of other smaller operating systems such as Bada and Brew), Nokia is betting the farm entirely on Microsoft and Windows Phone.

But for a $1 billion, I think that in the short term at least, Nokia can afford to.

What do you think? Will this gamble pay off for Nokia? Is Microsoft really that scared of Android?

Topics: Nokia, Android, Google, Microsoft

Kick off your day with ZDNet's daily email newsletter. It's the freshest tech news and opinion, served hot. Get it.

Talkback

119 comments
Log in or register to join the discussion
  • RE: How much did Microsoft pay Nokia NOT to choose Android? How about a cool $1 billion!

    I thought it was supposed to be the other way... I use your software, I pay you. Not, I use your software, you pay me.
    tatiGmail
    • Yes, Microsoft is so desperate here, they can only get WP7 on phones by

      paying out huge amounts of money. Pretty hilarious really. And, they are still losing market share.
      DonnieBoy
      • RE: How much did Microsoft pay Nokia NOT to choose Android? How about a cool $1 billion!

        @DonnieBoy
        So Google were going to give Android away to Nokia?

        Really?
        dazzlingd
      • RE: How much did Microsoft pay Nokia NOT to choose Android? How about a cool $1 billion!

        @DonnieBoy

        Hmmm. So they decided not to go with a multi versioned, buggy phone OS developed by an advertising company based on a cut-down 1990s OS . How much would Google have to pay to get over those hurdles?

        They were probably offering 2 billion ;-)
        tonymcs@...
      • Guys, Android is the most popular and gaining for a reason. Google ONLY

        offered Nokia the normal engineering help that they give to the manufacturers, nothing more. As the market results show, people do NOT like MS mobile operating systems. They are losing share faster than expected.
        DonnieBoy
      • RE: How much did Microsoft pay Nokia NOT to choose Android? How about a cool $1 billion!

        Nothing deparate or funny. Nokia has local mapping and ad services ms wants and lots of valuable patents. It's a no brainer for ms to pick that up in trade for WP licenses.
        Johnny Vegas
      • Also, Nokia has lost 10B in market cap since this deal, so, it really is

        hurting Nokia. The 1B to do the deal does not look so good anymore.
        DonnieBoy
      • And Google was as desparate as well, so why did you leave that out?

        @DonnieBoy
        I guess there is a real fear in Googleland if they where there offering tons of money and "experts", too.

        That's what I think is pretty hilarious really.
        It would show that Google is really worried about WP7 being adopted on competing phones.

        Otherwise they would have never flown up there to talk to Nokia face to face, right.

        And no Google is a business, run by businessmen, so your "next" statement about them doing it to "mess with MS" will come of sounding just as ridiculous as when you said it before.
        John Zern
      • RE: How much did Microsoft pay Nokia NOT to choose Android? How about a cool $1 billion!

        @DonnieBoy Um, I think they just bought market share. Time will tell as to whether it works out for them. They still probably make more money on Halo than RedHat makes. One of the few pure-play open source software houses.
        MS does need to lead out and quit trying to co-opt markets - after the fact. It is too expensive and takes too long.
        DevGuy_z
      • RE: How much did Microsoft pay Nokia NOT to choose Android? How about a cool $1 billion!

        @DonnieBoy They are losing market share because they haven't really done anything for a while. This is doing something. Time will tell, if it was a good choice. WP7 appears to be decent but it takes a while to reverse a downhill slide.
        DevGuy_z
      • RE: How much did Microsoft pay Nokia NOT to choose Android? How about a cool $1 billion!

        @dazzlingd
        As a matter of fact: yes, Google would have handed Nokia legal permission to access the Android source code, and permission to incorporate the compiled Android code in any devices Nokia manufactured, for no fee. As a matter of fact, everybody has that same permission. That's one of the consequences of Google's open source licensing model.

        Now, if Nokia had wanted to engage Google's engineers to provide technical support in adapting the software to work well on Nokia's hardware and to customize the user interface to meed Nokia's needs, then Google would likely have charged Nokia for providing that technical support.

        But the operating system itself: no fee for any manufacturer to adopt it.
        lfmorrison
      • RE: How much did Microsoft pay Nokia NOT to choose Android? How about a cool $1 billion!

        And that?s an unusual thing for a smartphone maker. While LG, Samsung and HTC and so on have Android and Windows Phone (and a smattering of other smaller operating systems such as Bada and Brew), Nokia is betting the farm entirely on Microsoft and Windows Phone.<a href="http://www.papermoz.com/book-reports/book-report-writing/">book report writing</a>
        <a href="http://www.papermoz.co.uk/dissertations/">Dissertation Writing</a>
        <a href="http://www.papermoz.co.uk/theses/">Thesis Writing</a>
        <a href="http://www.papermoz.co.uk/book-reports/">Book Report Writing</a>
        <a href="http://www.papermoz.co.uk/admission-essay/">Custom Admission Essay</a>
        Karston1234
      • RE: How much did Microsoft pay Nokia NOT to choose Android? How about a cool $1 billion!

        Thanks for sharing this information, keep up the good work. <a href="http://www.degreediscussion.com/forums/viewtopic.php?f=5&t=7922&p=59701">Woodfield High School</a> | <a href="http://www.articlezones.com/society/education/woodfield-university-changes-in-prior-learning-sector.html">Woodfield University</a>
        alanhawk
      • RE: How much did Microsoft pay Nokia NOT to choose Android? How about a cool $1 billion!

        It's a no brainer for ms to pick that up in trade for WP licenses. <a href="http://www.degreediscussion.com/forums/viewtopic.php?f=5&t=7922&p=59701">Woodfield High School</a> | <a href="http://www.articlezones.com/society/education/woodfield-university-changes-in-prior-learning-sector.html">Woodfield University</a>
        alanhawk
    • RE: How much did Microsoft pay Nokia NOT to choose Android? How about a cool $1 billion!

      @tatiGmail lol
      rantotiaray@...
    • RE: How much did Microsoft pay Nokia NOT to choose Android? How about a cool $1 billion!

      @tatiGmail

      As WP7 is so awful they have to.
      Alan Smithie
    • RE: How much did Microsoft pay Nokia NOT to choose Android? How about a cool $1 billion!

      @tatiGmail Yes and no. I mean do you think that all those Macbooks and iPhones you see people use in movies are things Hollywood buys? Of course not. They would buy an empty shell of a case if it came out of their own pockets. But sometimes in business you need to spend money to make money. Microsoft is in a rough spot with Android and iOS completely dominating the market and they needed to do something aggressive to penetrate that market. Nokia, like them or not, have been a major player in the cell phone world since the beginning. So the partnership is probably not a bad one. If Microsoft spends $1 billion to make $10 billion, its not a bad deal. (and no, I'm not saying that is how it will all go down...but it could)
      ExploreMN
    • RE: How much did Microsoft pay Nokia NOT to choose Android? How about a cool $1 billion!

      @tatiGmail I can clearly see how desperate Microsoft is if they plan to pay 1 billion dollars just for not choosing android.
      <a href="http://www.reverselookupcell.org/">reverse cell lookup</a>
      antony111
  • RE: How much did Microsoft pay Nokia NOT to choose Android? How about a cool $1 billion!

    Its a great deal for both of them. Microsoft will easily make up that $1bill in revenue once the Nokia phones are released. What is sad is the spin to try to make it sound like Microsoft didn't want them to go with android, its more like both companies knew better than to go with android for reasons that have been stated previously.
    Loverock Davidson
    • It's like leaping off a cliff together. How romatic.

      @Loverock Davidson - Which Microsoft PR firm do you work for?

      Android = Winner
      Windows Phone 7 = loser

      It would be logical for Nokia to go with the winner. The fact that it chose the loser, makes it obvious that Microsoft paid Nokia to avoid Android.
      Vbitrate