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| Authored by: dio gratia on Sunday, July 29 2012 @ 07:26 PM EDT |
There would have been a non-overlap between the two payment schedule's kicking
in to give Nokia an incentive to adopt Windows Phone. The delayed royalty
payment would have been to give Nokia time to implement a Windows Phone.
I've heard the royalties have a high minimum units threshold giving Nokia an
incentive to sell Windows Phone and it doesn't appear Nokia approaches that
threshold by a long shot. The balancing of the two payments at the bottom of the
royalty schedule makes failure of the enterprise relatively benign. It's an
indication that the relationship was negotiated, not strongly favoring
Microsoft.
In any event you'd expect Microsoft has to report income and losses to their
shareholders. Things like patent infringement damages come to mind, too.
Perhaps approaching a significant portion of a billion dollars last year.
There's also the European Union's fines that may result in earnings for past
years being adjusted.
You'd expect Microsoft is approaching an era where it's harder to hide costs of
doing business their way, due to a lack of expanding markets. Shareholders are
bound to demand more answers when per share losses appear than the IRS does when
earnings are simply lower than they might have been. One is out of the
investor's pocket the other only of concern when dropping below a threshold tax
rate.
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