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Samsung to pay Microsoft licensing fees on Android, other manufacturers may as well

by Phil Hornshaw

Amid all the talk about Amazon’s new Kindle Fire tablet, a tidbit of news slipped under the radar that could have a pretty big effect on device manufacturers bringing smartphones and tablets running Google’s Android operating system to market.

That news is that Samsung has agreed to pay licensing fees to Microsoft on a large number of patents reportedly used in Android. Specifically, that means that while Google doesn’t charge device manufacturers to use Android, the days of it being considered free are probably over. As TechCrunch points out, Samsung is the biggest Android device maker out there. If it agrees to pay, most likely other device makers will be paying, too.

Microsoft isn’t the only company out there doing this: in fact, patents and patent fights over the mobile space are getting so common and convoluted that one has to start wondering how anybody functions in the space at all. Apple and Samsung are currently slugging away at each other over patents concerning the iPhone, iPad, Galaxy S II and Galaxy Tab line, with no sign of either backing down anytime soon. And the big reason Google made the deal to acquire Motorola was to add Motorola’s patents to its own. Google wanted the patents so it could respond to lawsuits and threaten its own in order to avoid situations, basically, just like this one.

This is a pretty brilliant move on the part of Microsoft, as they win if device makers go with Android or if they support Microsoft’s Windows Phone 7. As you might guess, however, Google isn’t happy. As TechCrunch reports, Google has taken to calling the licensing fee move “extortion.” Microsoft has responded via Twitter, with a fairly characteristic reply: “Waaaah.”

How will Google & Android react?

It does seem like this could have some pretty deep implications for Android, and Google is right to be reacting, even if it’s just complaining. Device makers will now be considering Microsoft’s Windows mobile platform almost by default, not surprising given that they’re going to be paying Microsoft regardless. That could mean a sizable uptick in Windows Phone 7 devices in the near future, especially if Microsoft leverages these licensing payments in such a way that Windows becomes the better deal, which it undoubtedly will.

As for Google, it’s probably already in damage control mode, finding ways it can turn the tables on Microsoft. The trouble with Microsoft’s tactic is that it’s a lose-lose for everybody from the top down. Device makers paying licensing fees could cause them to raise prices on consumers for Android devices. If Google responds in kind, attempting to use its thousands of patents against Windows Phone makers like Nokia, then that could affect the prices of those devices. Or the whole thing could just end up with Google fighting Microsoft in court, none of which is positive for the mobile sphere.

Right now, it seems Samsung is paying up to Microsoft. HTC is doing the same. But as Google has pledged in terms of patent battles being waged against its partners in court, it’ll likely be coming to those partners’ aid in whatever way it can. Don’t expect this to be the last of Google vs. Microsoft.