Microsoft offers $1 billion to Samsung for future Windows Phones

[Matsuda]

With Microsoft's takeover of Nokia's devices business now more or less a done deal, questions are being raised about whether other manufacturers will continue to support the Windows Phone platform. At last count, Nokia's Lumia range accounted for an astonishing 90% of all Windows Phone sales, leading some to speculate that Microsoft's other hardware partners will turn their backs on it entirely, leaving the company to go it alone against rival smartphone platforms.

HTC, Huawei and Samsung were the first to join the company's 'rebooted' Windows Phone 8 offering, and they remain the only other manufacturers besides Nokia to offer WP handsets. Huawei recently launched itsAscend W2, but neither HTC nor Samsung have yet revealed firm plans for future devices with Microsoft's mobile OS.

While HTC's plans remain unclear, Mobile Review's Eldar Murtazin today revealed some information hinting that Samsung may yet remain a Windows Phone partner:




The suggestion that Microsoft may be offering a billion (dollars, we presume) to Samsung for its continued commitment to Windows Phone is significant, but not entirely without precedent. When Nokia joined the Windows Phone ecosystem, part of that deal included "platform support payments" of $250m per quarter - $1bn a year - from Microsoft as the Finnish company made its transition to WP.

Given the immense success that Samsung has seen with Android - and the negligible sales of its Windows Phone devices in comparison - the company has little motivation to continue investing in Windows Phone on the face of it. Against this backdrop, it would make sense that Samsung would be seeking some form of incentive from Microsoft to maintain its involvement in the platform, but at this stage, we only have Murtazin's word to go on.

Intriguingly, this report follows comments made a few weeks ago by ZTE executive vice-president He Shiyou, who confirmed that his company - which previously manufactured Windows Phone 7 devices - would bereturning to the platform with new devices next year. According to He, Microsoft executives visited ZTE, saying that the company is keen to "maintain a wide network of handset makers rather than simply make its own Windows phones." More significantly, He also mentioned that Microsoft had offered certain assurances and "clarifications" regarding the support that it will offer Windows Phone partners once the Nokia deal is completed.

Source

[Matt]

I've no idea since Microsoft is big company why not they make their own phone company and they offer such this number to other companies. Anyway it's really making me feel sick when I hear those numbers and the World still there's many poor people and they have to place to live and other speaking in billions F**K All the world leaders.

[geeteam]

Personally i don't know what MS is looking for... Perhaps i think they should come and recruit we over here and see what killer phone we're going to provide for them instead of buying what people have suffered for...

[iaTa]

I've no idea since Microsoft is big company why not they make their own phone company and they offer such this number to other companies. Anyway it's really making me feel sick when I hear those numbers and the World still there's many poor people and they have to place to live and other speaking in billions F**K All the world leaders.

Why don't you Google the Bill and Melinda Gates Foundation.

A philanthropic foundation of unprecedented scale. To date Bill Gates has donated around $30 billion to the foundation.

Edited December 12, 2013 by iaTa

[Matt]

I've no idea since Microsoft is big company why not they make their own phone company and they offer such this number to other companies. Anyway it's really making me feel sick when I hear those numbers and the World still there's many poor people and they have to place to live and other speaking in billions F**K All the world leaders.

Why don't you Google the Bill and Melinda Gates Foundation.

A philanthropic foundation of unprecedented scale. To date Bill Gates has donated around $30 billion to the foundation.

Will first of all wasn't mean Bill Gates, second I was mean ALL look how much the world leaders spend money on making killing weapons and how much they spend on making the world better.

[janedoe]

Will first of all wasn't mean Bill Gates, second I was mean ALL look how much the world leaders spend money on making killing weapons and how much they spend on making the world better.

This post was neither about world leaders, nor about weapons manufacturers, nor about money spent on world peace and prosperity, so let's not go off-topic unnecessarily.

Back to the topic, clearly Microsoft wants to pursue the Google Android model with multiple OEMs and possibly WP being free, and compared to the Apple iOS model with no third party manufacturers. I don't know what's driving them to choose one over the other, but one thing's for sure, they can't dream of scalping customers and earning the ridiculous profits that Apple does per device (and I'm one of the scalpees!)

Edited December 12, 2013 by janedoe

[Beamslider]

Is this kind of deal really that unusual?

[janedoe]

Is this kind of deal really that unusual?

Doesn't seem to be a first for Microsoft at least. As the article says a similar sort of deal was struck with Nokia too.

[insanedown58]

Hmm... I think the Nokia Lumia line will and should be the flagship. As for other OEMs, well whether they stay or leave, I don't think it would affect the WP market any better or worse.

[shasi]

samsung android is best than windows

[dMog]

the only thing microsoft is doing wrong with windows phones is just about everything.... they need to look at why the #1 and the # 2 phones have the market..because they are giving the people who buy a new phone every 16 days what they want...microsoft is not...and yes spending a billion dollars seems like a lot but is most likely far cheaper than starting from square one and building it all from nothing

[janedoe]

the only thing microsoft is doing wrong with windows phones is just about everything.... they need to look at why the #1 and the # 2 phones have the market..because they are giving the people who buy a new phone every 16 days what they want...microsoft is not...and yes spending a billion dollars seems like a lot but is most likely far cheaper than starting from square one and building it all from nothing

But what are the #2 (iOS) and #1 (Android) providing? In terms of hardware I can honestly say WP is not at all bad (Lumia 1020 for example is awesome). It's the weakness of the ecosystem that is tripping them up, i.e. it's all about the apps. People want their favorite apps, and obviously there's a lot more choice on iOS and Android so naturally that's what they gravitate to. Developers ignore or only consider WP as a distant afterthought due to the low market share and number of users. As the app situation improves slowly and if OEMs like Samsung come out with even more awesome hardware (encouraged by financial support from MS and the OS going free just like Android as rumored), WP is likely to move past iOS (it already has in some countries) and perhaps one day will be in a position to compete for the #1 spot.

Edited December 14, 2013 by janedoe

[dMog]

funny thing is i do not have a need for or do i actually have a cell phone... but from what i see windows phone is hardly considered by those who want a smart phone... my biggest issue is how much it costs for time in canada to actually use cel phones and then the data plans are ridiculously priced here as well...when prices drop to what they are in other countries i know i will have one...but not before that ocours

[janedoe]

from what i see windows phone is hardly considered by those who want a smart phone...

The #1 reason for this is the ecosystem and lack of apps, I can assure you. No point buying good or even great hardware if the apps, games etc. you want simply aren't on there and there's no guarantee they'll ever be. The situation is improving slowly and some third party apps (such as those from Rudy Huyn including 6tag, 6snap, 6sec, 9gag etc.) are even better than their official counterparts on iOS and Android. Still, WP has a very long way to catch up to Android, and a lot depends on the decisions MS takes in future. If they break compatibility again like they did between WP 7 and 8 believe me they will be well and truly dead.

Edited December 14, 2013 by janedoe

[Avitar]

I'd buy a windows phone... if microsoft made all the apps themselves and made them all free. OR Imagine an OS where you can have tons of open source apps in a central "store" where everyone around the world contributed to making the application in question better. Oh wait... an OS like that exists already: Linux. hmmm wonder if linux can be put on a phone device.. ok hold on, isn't that Andriod? So how would MS compete with that? Well if WIN 8.1 can run from a flash drive, why not build a phone around that... and include a RAM chip with a WiFi card. With the right circuitboard it can fit. Secondly, why do you need to run "Apps" Why can't I just send over the .exe I have on my laptop and install the program on my phone? Why not open the BIOS and bootloader just the same as a laptop and install windows on your phone via a USB port. MS really needs to stop making tablets and make phones to do this.

and finally, why is there not a power button in the Metro Start Screen? WIN 8.1 can be made better than Win7, but it takes a hell of customizing. 2 weeks of tweaking and I'm almost there.

[dMog]

actually if they bundled their office suite into it for free they would make some heads turn in the business community...but that market is notorious for buying phones and not replacing them every 20 days like the general public does that buy them for the technological /accessory /toy factor

[janedoe]

I'd buy a windows phone... if microsoft made all the apps themselves and made them all free.

While we're at it I'd love for them to deposit a million dollars in my bank account too! :D For obvious reasons no app store exists where all the apps are free.

So how would MS compete with that?

It seems to have done ok so far competing on the desktop against Linux. If you think 99.9% mobile phone buyers care two hoots for the apps in their store of choice being open source, you're sadly mistaken. Availability, price and features are all that matter. No-one other than a few developers would care to download the source of a mobile app and tinker with it. If WP improves in terms of features, customizability, more apps in the store, better hardware and so on, I see no reason it cannot take on Android. Nothing in this world is guaranteed to last forever, certainly not market dominance.

Well if WIN 8.1 can run from a flash drive, why not build a phone around that... and include a RAM chip with a WiFi card. With the right circuitboard it can fit. Secondly, why do you need to run "Apps" Why can't I just send over the .exe I have on my laptop and install the program on my phone? Why not open the BIOS and bootloader just the same as a laptop and install windows on your phone via a USB port. MS really needs to stop making tablets and make phones to do this.

This is a terrible idea. Besides Windows RT, "full" Windows already can run on small form-factor x86 hardware. But I'm guessing you have never used any of the ones available now. I have. I got an Acer Iconia W3 (the first 8" Win8 device) at BUILD this year and have also used the Dell Venue 8 Pro and checked out the Lenovo Miix 2. Even on my 10.6" Surface at 150% scaling the elements on the desktop are difficult to pinpoint accurately using touch. On an 8" screen it's obviously much worse. On a 5 or 6" phone I'd ruin my eyesight I'm sure poking at traditional apps on the desktop, most of which don't even react well when scaling is set to anything other than 100%. The only use would be if the device is docked to a larger screen, but when we're talking about cellphones that's not something anyone does. The Metro UI with large full-screen apps actually makes perfect sense on smaller and especially touch-enabled devices. On a desktop it doesn't (as much), but anyone who claims that the desktop fares well on smaller screens is talking rubbish without any experience, I can tell you this.

BTW, I didn't even go into the whole malware situation. WP is locked down for a reason, as are other mobile platforms. Still we've already started feeling the need for running anti-malware apps on our phones. The last thing we need are phones running "full" Windows where we have to deal with all sorts of malware, fiddle with an AV/firewall/anti-spyware, wrangle with trashy programs that corrupt the OS requiring reinstalls, worry about updates and all the other issues we're all familiar with. You might want such a phone but I don't, and I bet no-one else does either.

[janedoe]

actually if they bundled their office suite into it for free they would make some heads turn in the business community...but that market is notorious for buying phones and not replacing them every 20 days like the general public does that buy them for the technological /accessory /toy factor

Which suite are you talking about? WP 8 has Office Mobile 2013 bundled, and you can of course use the Office 365 services too. "Full" i.e. x86 Office obviously won't run on WP. The 8" tablets I mentioned above come bundled with Office 2013 Home and Student as weLl, and of course RT devices have Office 2013 RT bundled.

[dMog]

as i said i do not have a smart phone or even a basic cell phone for that matter so do not really know all i need to know( SEE MY RANT ON COST OF SERVICE FOR cANADIANS)..the bundled software You are telling about..are they full programs and not trial ware like what is bundled with every micro soft OS for a desk top or a notebook... as i said i plan to eventually buy a smart phone but am still waiting for a huge price drop for service in canada...some of the countries i travel to for cost of service make canadien carriers look like gun toting bandits when they present you with your monthly service bills

[truemate]

after nokia now samsung

[nIGHT]

After reading this article and the posts here, I never found some good points that make this is a strategy move rather than a desperate one. ;)