Microsoft offers Windows Phone free to device makers -- report

Two phone makers in India will be spared the usual licensing fee for adopting Windows Phone, says The Times of India.

Josh Long/CNET

Microsoft reportedly will dole out Windows Phone for free to a couple of Indian phone makers to spur adoption in the country.

The software giant has been chatting with Indian phone makers about developing more affordable Windows Phone devices, The Times of India said on Thursday, citing "multiple industry sources with knowledge of the negotiations." Two device makers purportedly agreed, but only after Microsoft promised to drop the normal license fee for its mobile OS, according to the sources.

"For our planned Windows Phone handsets, we are not paying Microsoft a licence fee," a source at one device maker told The Times of India. "The company is obviously exploring new models for Windows Phone. It must have realized that the older model where it licenced the OS did not work out well, even with Nokia's support."

Assuming the report is true, Microsoft would be breaking with precedent. The company typically earns its bread-and-butter by charging a licensing fee for each Windows Phone handset. Microsoft even charges key partner Nokia to make Windows Phone devices.

And just how much does Microsoft earn? In January 2012, an executive with ZTE said that Microsoft charges the device maker between 15 and 20 British pounds (currently $25 to $33) to license Windows Phone 7.

Responding to a request for comment on the Times of India story, a Microsoft spokesperson told CNET that "we cannot discuss confidential licensing terms."

Update, 10:45 a.m. PT:Added comment from Microsoft.

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