Microsoft and LG Make a Deal with Android and Chrome OS

Microsoft Corp. (NASDAQ:MSFT) and LG Electronics have signed an Android/Chrome OS (NASDAQ:GOOG) patent licensing deal. Horacio Gutierrez, corporate vice president and deputy general counsel, Intellectual Property Group at Microsoft said, “We are pleased to have built upon our longstanding relationship with LG to reach a mutually beneficial agreement. Together with our ten previous agreements with Android and Chrome OS device manufacturers, including HTC, Samsung and Acer, this agreement with LG means that more than 70 percent of all Android smartphones sold in the U.S. are now receiving coverage under Microsoft’s patent portfolio. We are proud of the continued success of our program in resolving the IP issues surrounding Android and Chrome OS.”

Gartner estimates the deal to have 4.8% of the mobile phone market in Q3. “Our forecast for the end of the year remains broadly in line at a worldwide level, as regions such as Asia/Pacific and the Middle East and Africa make up for weaker performance in the Western European market,” said Annette Zimmermann, principal analyst at Gartner based in Munich.

Microsoft is demanding Samsung pay $15 for each Android phone it ships. Samsung wants to pay $10 in exchange for a “deeper alliance” with Microsoft. Microsoft is already being paid royalties from HTC. It has also signed numerous other Android licensing deals, enough that Android’s unbelievable expansion may quickly translate into billions in licensing revenue.