While Microsoft and Google are rivals in many arenas, Microsoft makes a substantial profit from patents used by Android vendors. However, despite Microsoft's commitment to transparency, these agreements have only been revealed in legal surroundings -- until now.
Patent licensing deals agreed between the Redmond giant and Android device makers grant Microsoft revenue for every device made using the company's intellectual property. In November last year, Nomura analyst Rick Sherlund estimated that Microsoft was making as much as $2bn in Android patent licensing agreements. These funds are believed to be covering losses in the tech giant's entertainment division, covering Xbox, Windows Phone and Skype.
The company has never revealed the patents and fees centered within licensing deals, unless required to do so in the courtroom. However, documents posted on the Chinese Ministry of Commerce (MOFCOM)’s website detail the full range of patents included within licensing agreements. As reported by Ars Technica, the patent lists were submitted as part of the Chinese government's review of the purchase of Nokia's handset division by Microsoft for $7.2 billion.
Chinese regulators approved the deal in April after examining whether Microsoft's licensing agreements could be used in an anti-competitive fashion, and whether Nokia might be tempted to ramp up the costs of licensing.
The patents, which are found on the Chinese language version of the website, include 73 standard-essential patents generally used in mobile technology, as well as 127 Android-implemented patents -- both developed by Microsoft and acquired by participating in the Rockstar Consortium. In addition, a number of non standard-essential patents were examined by Chinese regulators, including 68 patent applications and 42 issued patents.
A list detailing all 310 patents can be found here (.DOCX).
In an April 8 blog post, Microsoft said MOFCOM's antitrust investigation concluded the company "holds approximately 200 patent families that are necessary to build an Android smartphone." However, the patent list sees to suggest these patents are not so much families as singular patents necessary to Android technology.
Earlier this month, Microsoft struck a deal with Chinese security vendor Qihoo 360 to develop mobile internet and artificial intelligence technologies. Microsoft's Beijing-based Asia Internet Engineering Academy -- the unit working with Qihoo 360 -- researches search engine technology, advertizing and mobile Internet services, while Qihoo 360 focuses on mobile security, browsers and Android applications.
Despite a recent strengthening of relationships between the Redmond giant and Chinese firms, the PC maker has been placed under scrutiny by the country's government, alongside IBM, Google and Apple. Chinese state-owned media has reported on the dangers inherent with U.S. technology, and by way of example, Windows 8 has been branded a cybersecurity threat.
In June, Ni Guangnan, an academic at the Chinese Academy of Engineering, labelled the operating system a threat due to its ability to collect data and transmit information through the cloud. This, in turn, means that Chinese citizen data could end up in the hands of the U.S. government, according to the academic. As Microsoft has not given the government its source code, China has banned the system from use on new government computer systems.
Recent accusations and suspicions have stemmed from the release of confidential documents by former U.S. National Security Agency (NSA) contractor Edward Snowden, revealing the U.S. government's involvement in wiretapping, zero-day exploitation and bulk data collection worldwide.