Nokia may be back to winning ways, but the company will still get more in payments from Microsoft as part of its agreement with Redmond, than it will pay in the form of OS royalties.
The company announced the filing of its annual report for 2012, and shared more details on the deal it signed with Redmond back in 2011 to adopt the Windows Phone platform. The report says:
“In 2013 the amount of the platform support payments from Microsoft to Nokia is still expected to slightly exceed the total amount of the minimum software royalty commitment payments from Nokia to Microsoft.”
As decides in the agreement, the Finnish company receives approximately $250 million from Microsoft every quarter ($1 billion every year) in the form of platform support payments. A reasonable figure considering the fact that Nokia is undoubtedly the only flag bearer of Windows Phone for now.
Things will take a turn in the long run though, and the company expects to pay Redmond more in the form of royalties than what it will have received:
“The remaining minimum software royalty commitment payments from Nokia to Microsoft are expected to exceed the remaining platform support payments from Microsoft to Nokia by a total of approximately EUR 0.5 billion over the remaining life of the agreement.”
No further details are provided on the matter by Nokia, other than these figures. The deal actually ends in 2016, and by then the company will end up owing Microsoft $650 million.
Oh well, this will (almost) make up for recent the EU fine.
Ultimately this agreement has come out good for both companies — Nokia gets to drive the platform forward, while Microsoft get an important partner on board that not just builds smartphones but also does exclusive research and development for it. This is the very definition of the word, win-win.
