China-based smartphone giant ZTE has joined an ever-growing list of firms that make Android-based devices in licensing Microsoft patents. But this agreement is unique in that it covers ZTE phones, tablets, computers, and other devices running both Android and Chrome OS.
“Eighty percent of Android smartphones sold in the United States and a majority of those sold worldwide are now covered under agreements with Microsoft,” Microsoft Vice President Horacio Gutierrez noted. “While others continue to pursue litigation around the world as the primary means of addressing their differences, we have successfully entered into license agreements with nearly all companies on the list of the world’s largest Android smartphone vendors and their manufacturers.”
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The announcement follows a similar agreement with Foxconn parent company Hon Hai, revealed last week. (Foxconn is the China-based manufacturing giant that actually makes virtually all of Apple’s products, as well as video game consoles like the Sony PlayStation 3 and Nintendo Wii U.) One might surmise that Microsoft is making a concerted push in China in recent months. Perhaps Huawei will be next.
“The ZTE and Foxconn agreements show once more that technology companies around the world, including some of the world’s largest and fastest-growing manufacturers anchored in China, recognize that licensing is an effective way to share technology and build on each other’s work, accelerating the pace of innovation and delighting customers,” Gutierrez added. “Much of the current litigation in the so-called ‘smartphone patent wars’ could be avoided if companies were willing to recognize the value of others’ creations in a way that is fair … respect for intellectual property rights is a two-way street.”
On that note, Microsoft isn’t just a collector of patent licensing fees. Gutierrez says that the firm has paid out over $4 billion in licensing fees to other companies in the past decade.
Terms of the agreement, as usual, are confidential. But that hasn’t stopped some from guessing that Microsoft’s latest $1 billion business is in fact patent licensing. At least the company is patenting technology.