Microsoft Will Pay Nokia “Billions” To Use Windows Phone

Microsoft paid Nokia $250 million in the fourth quarter to adopt the Windows Phone operating system, according to Nokia’s fourth-quarter earnings report released Thursday.

That was the first in a series of so-called “platform support” payments believed to eventually total billions of dollars. To date, Microsoft and Nokia have been quiet about the deal’s specifics, perhaps because it appears as if Microsoft is paying Nokia significantly less than its paying other cellphone manufacturers.

“Our broad strategic agreement with Microsoft includes platform support payments from Microsoft to us as well as software royalty payments from us to Microsoft,” Nokia said in its results today. “We have a competitive software royalty structure, which includes minimum software royalty commitments.”

Slashgear’s Chris Davies is suggesting Microsoft’s Nokia arrangement is less than that it has struck with other cellphone makers. LTE, for example, is reportedly paying about $27 for each phone it sells with Windows Phone.

“Over the life of the agreement both the platform support payments and the minimum software royalty commitments are expected to measure in the billions of U.S. dollars,” Nokia said.

Windows Phone has gotten rave reviews, but Microsoft could struggle to get developers to create apps for the phone. By some estimates, Windows Phone could pass Apple’s iOS in market share by 2015.

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