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Microsoft signs up Compal in patent deal, claims to get cut from half of all Android devices

Oct 24, 2011 — by Eric Brown — from the LinuxDevices Archive — 2 views

Microsoft has signed a patent agreement with $28 billion Taiwanese original device manufacturer (ODM) Compal Electronics. With this tenth Android agreement, over half of all Android devices are now being made by companies that have signed Android-related licensing pacts with Microsoft, claims the company.

Compal Electronics has a $28 billion business, and represents 16 percent of the Android ODM market, according to Microsoft, which already signed up the other two major Taiwanese ODMs in previous patent deals with Wistron and Quanta Computer. The latter is the manufacturer of's Kindle Fire Android tablet, while Compal manufactures the Motorola Xoom tablet, among other devices.

Android patent licensing and litigation

Source: Microsoft

Like the Wistron and Quanta agreements, the Compal pact covers both Android and Google's fledgling, Linux-based Chrome OS. The company offered no more details except to say Microsoft will receive royalties from Compal.

In addition to completing its Taipei trifecta, Microsoft announced that as of this 10th Android patent deal, over half of all Android devices are being manufactured by companies that have signed patent deals with Microsoft. Along with the Compal deal, it was Redmond's recent pact with Samsung that apparently put it over the top.

Worldwide ODM market share by revenues (Q2CY11)

Source: Microsoft

Microsoft even released a market share chart (above) claiming that Compal, Quanta, and Wistron represent half of worldwide ODM revenues. A separate chart (below) showed the company's Android smartphone license deals, primarily with HTC and Samsung, which represent 53 percent of all units sold in the U.S., according to Microsoft.

U.S. Android smartphone market share by units (Q2CY11)

Source: Microsoft

In case Android device makers didn't get the message that Microsoft is their Daddy, the company released a helpful infographic showing recent patent deals and lawsuits related to Android. Shown at the top of this story, the diagram offers the clearest evidence yet that Microsoft sees its efforts as part of a larger, existential battle against Google and its cohorts. Arrows mark Apple's patent related suits and Oracle's lawsuit against Google in addition to Redmond's own patent victories and battles.

A blog posting by top Microsoft lawyers Brad Smith (executive vice president and general counsel) and Horacio Gutierrez (corporate vice president and deputy general counsel) claims that Microsoft has spent about $4.5 billion over the last decade to license in patents from other companies. It doesn't, however, state how much it makes in royalties from those agreements.

The provocative posting goes on to paint Microsoft as an agent of stability and sanity in a market gone mad, rather than as one of the chief instigators of instability.

"For those who continue to protest that the smartphone patent thicket is too difficult to navigate, it's past time to wake up," state the two top Microsoft lawyers. "As Microsoft has entered new markets from the enterprise to the Xbox, we've put together comprehensive licensing programs that address not only our own needs but the needs of our customers and partners as well. As our recent agreements clearly show, Android handset manufacturers are now doing the same thing."

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