In a statement released today, Microsoft and Pegatron announced an agreement which will allow Pegatron to license Microsoft's patent portfolio for products like Pegatron's "eReaders, smartphones and tablets running the Android or Chrome platforms" in exchange for royalty payments to Microsoft.
Although terms of the deal were not disclosed according to the press release, Microsoft will likely get a small percentage of revenue from every Pegatron product sold that uses any of Microsoft's patents. Earlier this year, LG signed a patent agreement with Microsoft covering the company's Android devices. Microsoft also signed an Android patent agreement with Compal in October, and has patent agreements with HTC, Samsung, Acer, Quanta, Viewsonic and other Android device manufacturers. The Pegatron deal gives Microsoft patent agreements with four of the top five Taiwanese Android device manufacturers, according to a tweet from Microsoft's Corporate Communications account.
According to a Business Insider article, Microsoft is estimated to receive $3 to $5 for every Android device sold from companies that have Android patent agreements with Microsoft, which gives Microsoft an additional $444 million in annual revenue. By comparison, ZTE, which has a licensing agreement with Microsoft for Windows Phone, pays Microsoft between $23 to $31 for each Windows Phone device it sells. For 2011, Microsoft is believed to have made a maximum of $613 million in revenue from Windows Phone licensing, according to an article from the Seattle Post-Intelligencer.
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