The quarterly platform support payments for Microsoft’s Windows Phone generally surpasses the royalty payments from Nokia Corporation (ADR) (NYSE:NOK) to Microsoft Corporation (NASDAQ:MSFT) for the usage of their software but that all is about to change.
The prior arrangement has been in place since 2011. Nokia Corporation (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V) started using the Windows-based phones as their primary smartphone.
Naturally it’s predicted that both companies will exchange billions of dollars back in forth. It should be noted that Microsoft Corporation (NASDAQ:MSFT) has gave more money to Nokia than the company gave them.
However, Nokia just revealed, that could change. In a recent financial report regarding Q4, Nokia Corporation (NYSE:NOK) revealed that they get more financial assistance than they pay for minimum software royalty commitment payments. They predict the rest of the deal will no longer be so much of a net beneficiary during the quarterly exchanges.
“To date the amount of platform support payments received by Nokia has exceeded the amount of minimum royalty commitment payments to Microsoft Corporation (NASDAQ:MSFT). Thus for the remainder of the life of the agreement the total amount of the minimum software royalty commitment payments are expected to exceed the total amount of the platform support payments,” said Nokia Corporation (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V) in its announcement.
This could mean that Nokia expects to produce more Lumia devices, more than last year’s 4.4 million sold in 2012.
The Verge reports that Nokia will bring a flagship Lumia to Verizon some time this year. The phone is predicted to be a variant of the Lumia 920 but there are no predictions on expected price or features.
This report isn’t too surprising as Steve Elop, chief executive officer for Nokia, made hints that they may release a flagship phone for Verizon in the near future.
Verizon Communications Inc. (NYSE:VZ) already offers the Lumia 822 for free with a two-year contract. This phone features 8MP auto-focus rear camera with Carl Zeiss Tessar Lens, NFC, and 4G LTE.
Although Nokia Corporation’s (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V) partnership with Microsoft has proven to be less successful than they hoped, things may be looking a little brighter for Nokia.