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Nokia Was Paid $250 Million in Just One Quarter for Windows Phone Adoption

Stephen Elop holds Windows Phone

Have you ever wondered why Nokia chose to use Microsoft’s Windows Phone platform for its future handsets, and not Google’s Android operating system? Or why it didn’t just launch devices for both markets like Samsung or HTC? Well, it may be something to do with quarterly payments of around $250 million.

The Finnish company released its fourth quarter financial results today, which revealed it had received a rather large sum of money from its partner over in Redmond. In the fourth quarter of 2011, Nokia was paid its first quarterly “platform support payment” of $250 million. And it won’t be the last; these payments are expected to “measure in the billions” over time:

Our broad strategic agreement with Microsoft includes platform support payments from Microsoft to us as well as software royalty payments from us to Microsoft.  In the fourth quarter 2011, we received the first quarterly platform support payment of USD 250 million (EUR 180 million).

We have a competitive software royalty structure, which includes minimum software royalty commitments. Over the life of the agreement, both the platform support payments and the minimum software royalty commitments are expected to measure in the billions of US Dollars.

The Next Web notes that a portion of these payments is likely to help Nokia with its Lumia marketing campaigns, which have included a 3D lights show on the banks of London’s River Thames, and numerous TV adverts.

But despite Microsoft’s payment and the popularity of its new Lumia devices, Nokia reported a €1.07 billion (approx. $1.4 billion) loss in its fourth quarter, as sales declined by 21% year-on-year. But it did see an increase over the third quarter, with 19.6 million smartphones and 93.9 million mobile devices sold, representing increases of 17% and 5% respectively.

So now you know why Nokia chose Windows Phone over Android or any other mobile platform.

[via The Next Web]

Killian Bell

Killian Bell is a 20-something technology journalist based in a tiny town in England. He has an obsession with that little company in Cupertino...