Report: WP License Cost $25 per Device, $90 for RT

| December 17, 2013 | 78 Replies

Nokia collection

Recently we’ve heard rumors that Microsoft might be planning versions of WP and Windows RT that do away with the the licensing costs, and instead make back the money by in-app ads, and pushing their bundled services such as Skydrive and Skype. Microsoft and Nokia however have never actually commented on the individual cost of each WP/RT license, making many wonder exactly how expensive/cheap each device costs to push out the door.

However we at MNB can report that a source familiar with Microsoft’s licensing scheme have shared the prices of the respective licences with us. A single Windows Phone 8 license costs close to $25 per device (or £15); a Windows RT license with the Office suite (like what the Lumia 2520 would come with) costs $90 per device (or £55).

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Although $25 might not sound like much for a $500 device, it certainly makes a huge impact at the lower end of the spectrum, with devices such as the Lumia 520 and 525. Effectively getting rid of these licensing fees could drop the price an extra $25 without affecting the profit margins for Nokia; and seeing that the Lumia 520′s biggest selling point was its price, imagine what would happen if it were $25 cheaper. Currently Amazon are running a promotion on the Lumia 520 selling it for only $50 off contract), which could theoretically be $25 if the licensing fees were removed.

Although WP8 already reached a very low price-point this price-point could still be pushed further, without compromising on the performance of the devices; provided Microsoft change their licensing strategy. Something that would benefit OEMs greatly, and make WP a more attractive choice for budget smartphones; we’ll have to wait and see if Microsoft will indeed slash their prices, but at least we know what it costs to make a WP device.

 

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Category: Lumia, Nokia, Windows Phone

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Hey, my name's Ali- Currently a fifth (and final) year Dental Student from Chicago; studying in Jordan. I love all sorts of gadgets almost as much as I love my cookies! Be sure to follow my Twitter handle @AliQudsi and Subcribe to my Youtube for the latest videos - no pressure. Thanks.
  • jiipee

    I dont think Nokis had paid 25$ for each device. In MS acquisition materials the number was slower.

    • http://aligonemobile.blogspot.com/ Aliqudsi

      Don’t forget that that Nokia had a minimum number of licenses agreement, meaning they were paying for them either way.

      • Random Random

        The cost for Nokia was effectively zero because of the platform support payments so it wasn’t so bad for them.

        Then again using in house operating systems cost them even more money and now they didn’t have to pay that.

        • Krishna6233

          the platform support payment was also effectively useless because they were selling phones in puny amount :D

          • Random Random

            Well.

            Still much cheaper than using an in-house OS. Nokia would have collapsed with an in-house OS.

            • Noki

              says the man with the crystal baaaaaals

              • http://www.jolla.com xerxes2

                Yeah I see RR is still around, living his anti-nokia religion. :)

            • krishna6233

              did Nokia survive without an in-house os?i heard they were sold for a cheap price to ms?
              yes?
              no?
              yes?
              sno?

              • Random Random

                Only the D&S were sold.

                Nokia still exists and is more valuable than for example BB.

                • Noki

                  And thank good WP for that I hear they are so happy with it they are going to migrate the NSN to WP powered routers hahahahahahaha:D

                  What as the fact that the area that had ZERO to do with WP managed to survive, with WP, exept that maybe as a stretch of inference one would say that all things presented its was because it had nothing to do with WP that they survived??? I mean many more less Random people were saying the NSN division was doomed…

                  For all good value of what we are talking here. smartphones NOKIA IS DEAD!

                  • who knows

                    You truly don’t have a clue about Nokias financials, do you? To have an idea of what happened to Nokias D&S you need to look at the company as a whole and through time. You really should check Nokias financial reports from 2010 and forward to know how both NSN and the acquisition of NavTeq has damaged Nokias financial wellbeing. Those two business segments has very much affected Nokias ability to work independently as a phone company.

                    2012 was a really bad year for Nokias D&S, the operating profit was – 1 100 million euros. NSN was the same year – 800, not really a poster child. Did you know that Location & Commerce (NavTeq) was – 1 500 million euros in operating profits 2011 just to put some things in perspective? Funny, I can’t remember you writing endless hate posts about Navteq and how they destroyed Nokia back then.

                    The sad part in all of this is that Nokia had every bit of ingredient (technical know-how, resources, time, intellectual property, working culture….) to become this magnificent company if they just didn’t had the absolute worst timing ever in the industry.

          • who knows

            Ìf Nokia was selling in puny quantities, doesn’t that effectively mean that the platform payment was more, not less, important?

            • Noki

              Think that in the hole story, the funniest bit was the “platform payments”.
              I will give you one BILLION $$$$$ but you have to buy my crap that I will produce any way and will spend money in any way for just 1 billion $$$ don’t care if you sell it or if you don’t…

              Microsoft spent ZERO nothing NADA to bring NOKIA to its knees… Brilliant…

              • who knows

                Microsoft spent one billion dollar every year in platform payments, they spent money on developing the operating system (which actually Nokia could dictate what they should focus on) and they spent money on advertising Nokias phones.

                Sure looks to be some money involved.

                How does Blackberry do these days all alone? Are they thriving? Here I was thinking that they wanted to sell their hardware business but couldn’t find a buyer. Oh well.

                • Noki

                  “How does Blackberry do these days all alone?” well unlike Nokia still alive

                • Random Random

                  Well.

                  Nokia is doing much better than BB.

                  • noki

                    how? literally there wont be any more nokia phone in less than a couple of months…

                    • Razoor

                      Heard of NSN and Here?

                    • Noki

                      Yes, have you reading comprehension problems or will we see a HERE branded phone or an NSN branded phone for sale???

            • Random Random

              That’s a very good point you made.

              Nokia was able to cut off the payroll the people developing the obsoleted operating systems.

              At the same time they had access to a competitive operating system. Of course WP had the same problem MeeGo had. It started too late.

              • GordonH

                BB came out 2 yrs late with their new BB OS and they are still surviving. Nokia was 2 years early to WP8 and now have they company taken over by MS.
                This is good for Nokia.

                Welcome to under article with 50 comments by RandomRandom trying to protect his boses at MS.

                • Razoor

                  They were up for sale, but nobody wanted to purchase them. Is that surviving for you?

                  • Noki

                    You don’t know the terms for the sale that wanted to take the company private.

                    STILL IT OUTLASTED NOKIA….

                    WP can claim a new motto,

                    “WP BRINGING GIANTS DOWN”

              • GordonH

                A top smartphone selling OS was made out to be a disaster . While a great Linux OS Meego was lied as not being ready. Android alternative was told that google did not allow differentiation.

                And yesterday WP’s slow and minimum sales are pushed as very positive for Nokia’s future.
                Today Nokia devices division being sold off is being pushed as very positive for Nokia.

                • Random Random

                  Of course MeeGo was not ready.

                  Nokia only started working on the Swipe UI in August 2010 and it took them a full year to get it working and rewrite pretty much all the applications.

                  When MeeGo was released, it was still missing lots of features.

                  Comparing MeeGo to another not ready OS like WP doesn’t make MeeGo any better.

                  Nokia should have started earlier. That’s the problem.

  • Patata

    MS should get rid of that license costs, or else someone could expect them to actually offer some value for that money, instead of a featureless and barely updated OS ;)

    • Random Random

      People say that iOS had barely any features when it was launched and they also say that Apple never really adds anything to it.

      That means that WP is doing the very same iOS is.

      • Patata

        And yet Microsoft isn’t Apple and we don’t live in 2007 anymore.
        Apple has its Appstore and a huge amount of premium content / games.
        Apple has a much cooler / modern image than MS will ever have.

        • Patata

          And of course Apple doesn’t sell their OS to other OEMs and asks them to produce devices for their Ecosystem

        • Krishna6233

          haha …true. ..Microsoft is just jealous of apple and Google! instead of improving their own os ..more interested in attacking them with ads like scroogled..,,terrible!

          • Random Random

            That’s pretty much the same what Nokia was doing.

            Nokia was iPhone envy since 2007.

            Jorma Ollila wrote in his book that the Nokia board knew in the May 2008 that Apple was going to win the battle of smartphones.

            This explains the iPhone envy.

            • Noki

              wen confronted with WP/microsoft glaring incompetence…….. Say….. “but nokia is worse :)” TAAAAADAAAA there RANDOM for you

            • krishna6233

              But they were not running any crapple campaign or scroogled ,were they?

              • Random Random

                What does that mean?

        • BEN

          hahah today its the opposite, Apple is old and slow like the old Microsoft days. Microsoft has a new image, a new corporate image that beats Apple. Sorry don’t talk crap.

          • Random Random

            Well.

            Apple has been improving iOS quite a bit.

            Of course it doesn’t feel like to it for those people who don’t understand why the improvements are made.

            Some people even said that they only changed the icons. What can be said about those people? They just don’t understand the mobile.

    • who knows

      Yes and qualcomm should give away their processors for free, LG their screens….. or you just have to live in the grown-up world and find out that things actually cost to produce/develop. If you don’t like the operating system don’t buy it. It is as simple as that. In a market where you finally have some competition and diversity there’s some serious (and annoying) whining about having options.

      Just because you can’t see any positives about a product doesn’t mean anybody else can’t appreciate it.

      • Noki

        actually you give a fine argument against WP,

        Qualcomm, its not like they have the cheapest CPU’s do they… yet if you go with WP that’s what you get…..

        • who knows

          Having choices in the market is now an argument against WP?!?!?¤#”%&&”#¤%&”&”#¤”?

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  • twig

    Your new format is working great on Nokia Xpress. Will a smiley face work???

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  • GordonH

    Feb 2011 announcement came, guess where most developers ran to … right on to Android not WP7, most coders knew WinCE was wrong and shortsighted.
    Symbian development cost must less then the licensing cost of WP.
    Let me give u an example:
    nokia sold 100 million smartphones
    Symbian “suggested” R&D cost $1 billion
    $10 per device
    Ms will charges more than $25 per smartphone
    100million smartphones
    Total cost $2.5 billion
    Now MS might pay something for licensing maps etc. But Nokia could have earned more from the holding their own OS by selling apps, music etc.
    Now my about Meego, oh dear cost much much lesser and was ready two years before WP8.

    • Razoor

      Meego was far from ready.

      • Random Random

        Yes.

        MeeGo was not a finished product.

        Then again the costs for Symbian were horribly high since Nokia’s Symbian sales were destined to collapse because Android was starting to hit the low end.

      • Noki

        heee if call meego far form ready what do you call WP7 heeee stillborn? abortion? Microsoft typical product?

        • Amusment

          If MeeGo “was not ready” then why it works perfectly with Nokia N9? And several other devices like tablets?

          If MeeGo “was not ready” then I would call WP “FUBAR unsuccessful experiment which has effected with degenerated mutation unable to adopt to new circumstances of using it”, IMHO “degenerated mutation for masochists” also is good description. De-evolution, if you remember Mario Bross movie.

          • Random Random

            If MeeGo was so ready, well received and loved – why has it taken Jolla 2 years to put out their version, and Samsung/Intel STILL haven’t? It’s open source, where are the flood of Chinese devices running Meego? Where is HTC’s MeeGo phone? Sony’s?

            Of course it’s possible to make something work perfectly and still have lots of missing features.

            Also.

            If WP wasn’t ready, it doesn’t make MeeGo any more ready. In that case MeeGo was just more expensive choice. They did have almost 2000 people working for the MeeGo team.

            Very expensive.

            Also, it appears that Qt was not was easy to code for as iOS or WP was. That was another reason for MeeGo to fail.

            • Amusment

              >If MeeGo was so ready, well received and loved – why >has it taken Jolla 2 years to put out their version, >and Samsung/Intel STILL haven’t? It’s open source, >where are the flood of Chinese devices running Meego? >Where is HTC’s MeeGo phone? Sony’s?
              >
              Jolla is a startup, they planned to use NOVAtor platform but manufacturing company has split due to butchering Symbian market. Usually change of planned platform just in run needs a time. Besides the whole Jolla is 50 people, you have mentioned 2000 people were working with MeeGo in Nokia. Nokia has made only better looking device (then the style was grabber to Lumia), while Jolla has invented the Second Half. Seems they have made it quite quick. MeeGo devices from Lenovo, Asus, Acer, Sony has been cut after burning winds memo and butchering MeeGo in Nokia.

              Samsung works on Tizen, with Intel, what is not MeeGo like the Sailfish, but Samsung’s Bada combined with MeeGo from times of Harmattan.

              >Of course it’s possible to make something work >perfectly and still have lots of missing features.
              >
              You just have given Windows policy and definition. Far this reason there is no flood of Chinese devices running Windows, or HTC’s, or Sony’s.

              >Also.
              >
              Either.

              >If WP wasn’t ready, it doesn’t make MeeGo any more >ready. In that case MeeGo was just more expensive >choice. They did have almost 2000 people working for >the MeeGo team.
              >
              You have admitted Windows was not ready – what a great evolution!
              That was exactly Elop’s decision with argument “there are no more then one model” while there were not even one model with Windows. Having ready MeeGo model (Nokia N9) and great perspectives, but enforcing to use Windows is more expensive costs, by all means. They had no people working for the Windows team, so costs were unpredictable and much higher, and still has not created anything. Any flood of Windows phones? Have I missed WP ecosystem besides of 1% of market? And lost of D&R department – is this a lost or gain? Disappointed customers – is it a lost or advantage? Elop’s effect – is it important at all? For who? For Microsoft? For Nokia? For customers?

              > Very expensive.
              Indeed, Elop and his kindergarten were very expensive, by all means. And finally his demand for something about 20 millions for his divorce also was a comedy.

              > Also, it appears that Qt was not was easy to code for > as iOS or WP was. That was another reason for MeeGo to > fail.
              >
              And for this reason Qt is more and more popular for coding, and for that reason porting to Sailfish is so easy that takes a few hours. And for that reason MeeGo is still alive, only to mention projects like Mer or Jolla or the MeeGo Sailfish itself. And of course our dear RR will have a plenty of meaningless words to oppose, but still there will be nothing important among them IMHO.

              • Random Random

                Well.

                It has taken so long for Jolla to ship the phone because the open sourced UI was not ready. That pretty much means that MeeGo didn’t and doesn’t have a competitive open sourced UI.

                Of course WP wasn’t ready for matching Android and iOS. Just like MeeGo and Symbian were not ready for that task.

                Nokia moved lots of people from Symbian development to work on WP. The costs? Really quite predictable.

                The disappointed customers? Pretty much only few hundred thousand hard core Symbian users were disappointed. It’s very hard to believe more people really cared. They were just happy to move on Android and iOS as they would have done in any case.

                It’s quite easy to show how Qt is harder to code for. Qt enabled phones were sold for 4 months in Q4 2010 and January 2011. In comparable amount of time iOS received so much more apps compared to the applications released for Symbian’s Qt.

    • JG Smartypants

      Developers were never on board with meego in the first place as any survey of developer interest from 2010 (before elopalypse) shows

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  • n8thebest

    Um, these licensing fees will soon be irrelevant to Nokia’s handset division. Since the handset division will soon be a part of Microsoft, obviously the handset division will no longer be paying any license fees. So that will mean more competitive smartphones in the future coming from this former Nokia team.

    Microsoft actually clearly mentioned this when the buyout was first announced.

    Yes this does matter and will continue to matter for other OEMs, but not Nokia as soon as the handset division sale is complete.

    • Janne

      This isn’t relevant probably from a Nokia perspective, but if one is intent on following Windows Phone news, even the Microsoft division may pay internal royalties to the OS part of the business (like D&S paid to HERE at Nokia, on paper), plus of course this might be relevant speculation for WP/RT licensees that still exist – and with the Samsung 1B rumor, it seems Microsoft wants to keep them existing.

      Personally, I find the prospect of Windows Phone news quite boring without Nokia in the loop. But then I was never a Microsoft or Windows fan, even though I have nothing against them and consider them useful and important products for other reasons. I like them, I can appreciate there are some upsides as a Finn that Microsoft now does certain things in Finland, and there are useful products to use and know, but I just can’t be bothered beyond that.

      It will be interesting to see how many Nokia users transition over to Microsoft WP devices and how many not. Some opportunity for the competition. I wonder if the likes of Jolla, Ubuntu, Firefox, even Tizen can steal some of that thunder.

      • n8thebest

        Yes, but Microsoft obviously won’t be paying such royalties to themselves or transferring payments between divisions. They made that crystal clear in their PR releases when the deal was made official in September.

        Also that Samsung rumor I hope to God is completely false. It just seems so silly and ridiculous. Microsoft previously was giving A LOT of support to Samsung during the Windows Phone 7 era before Nokia entered the picture. Once Nokia entered WP, Samsung’s effort dropped a great deal. There was also internal word that Samsung was purposely abusing Microsoft’s help and not doing anything worthwhile with Windows Phone devices. That’s why for the past year Microsoft significantly reduced support to Samsung and increased support to Nokia.

        So this rumor makes no sense to me. Samsung has almost given up on Window Phone, and they were abusing Microsoft’s help. Microsoft figured that out and stopped helping them so much. WHY would Microsoft all of a sudden turn around and offer huge help to Samsung again? It’s clear Samsung doesn’t care about WP. They don’t even care about Android itself that much. They mostly care only about their Galaxy phones, and their Tizen project, that’s it. They don’t even care about pissing Google off, as they’ve done that several times in the past already.

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  • Amusment

    Microsoft has announced that WP8 is finished (what IMHO means more or less it’s dead) and they going to leave it, and use “completely new” WP9. What also mean every purchased soft for WP8 will be useless and there will not be a replacement with WP8. So if one’s Lumia will die (it is not so durable as Nokias used to be) then one will have to buy a new toy with WP9 and buy software for a new WP9. Simply and easy, just for those who like to pay twice for the same soft.

    I am just curious who will tell openly that buying current Lumia is buying a phone with windows already outdated and sentenced? As WP9 is to be sell at around beginning of next year?

    • Random Random

      What makes you think that WP8 applications won’t work in future WP versions?

      Are you just guessing?

      • Amusment

        No, by experience.
        Have you forgotten closed site with pay software, what caused that owners were to pay for software purchased already?
        Have Microsoft denied updates of Windows? So, new software will be useless. Or am I wrong?
        Have anyone experienced help in case of not working soft? I have experienced advice “you must buy a new device and new software for it, this Lumia will not work with this”.

        What makes you think that WP8 applications will work in future WP versions?

        Are you just making a declaration it will work and you will pay damages if it will not be working? Are you in power to speak in the name of Microsoft?

        Are you just guessing? What is a base for your guessing??

        • Random Random

          In that case you got your experience wrong.

          WP7 applications work on WP8. That gives us no reason to assume that WP8 applications wouldn’t work on the future versions.

          From a Nokia user’s point of view there is nothing strange in not being able to upgrade the OS of a phone. Remember that in Q4 2010 Nokia sold 28 million Symbian phones. The users were able to upgrade only 18% of those devices.

          • Amusment

            hahahaha, “In that case you got your experience wrong.” – thank you, I really needed you to understand my experence, now I see what is your gift: explaining others their experiences, especially why they got them wrong. Have you heard about Windows televangelism? It seems to be about this, or a Windows cult/sect.

            Try to upgrade Lumia from Windows “current-number” to Windows “current-number + 1″, good luck!

            Symbian was a standard, while Windows is the niche with Nokia only and around 1% of market. It is simply nothing at all. 18% of Symbian devices counts in dozens of millions, while 18% of Lumias counts in hundred of thousands.

            • Random Random

              You seem to be talking about two different things.

              Upgrading WP7 to WP8 can’t be done. Just like updating Symbian to Symbian 3 on N97 can’t be done.

              Running a WP7 application on WP8 can be done. On Symbian running the application on a new device was sometimes possible.

              Symbian wasn’t a standard. It was not possible to run a Symbian application made for UIQ, on a S60 device even while both were Symbian devices.

              In the later years it was not possible to run a Symbian3 application on those Japanese Symbian phones.

              However Symbian was. It was no more because it became obsoleted by Android and iOS. There was no migration path to MeeGo since Qt was apparently so much harder for the developers to use, compared to creating apps for iOS.

              Maybe there were other reasons, but we never saw enough Qt applications by the end of 2010. There should have been lots of them on just three months. But there weren’t. In a same amount of time iOS received tons of those while Symbian got not too many.

              There just weren’t anything to migrate from Symbian to MeeGo.

              Having a disappointing WP compared to MeeGo doesn’t make MeeGo any better. Those both were losers as far as maintaining Nokia’s market share or unit sales were concerned.

              • Amusment

                It is boring. Repeating the same rubbishes again and again will not make them any wiser.

                Upgrading WP7 to WP8 can’t be done, because it is programmed ageing of product.

                Symbian wasn’t a standard? Something that has 70% of market is a standard. Like driving wheel on right side. When an app is for one version then there is no guarantee it will run on another, is it strange you?

                Why to run any applications on those Japanese phones? Who cares? Japanese market is entirely different world – and frankly: much more foreward and advanced in this scope.

                Many developers are just on the migration path to MeeGo Sailfish since has appeared Qt is so much easier for developers to use, comparing to creating apps for other OSes like Windows or iOS. New quality with Sailfish.

                The reason we haven’t seen more applications was Elop’s decisions and things like “burning winds memos”.

                Having a disappointing WP compared to MeeGo doesn’t make WP any better. WP is losers as far as maintaining Nokia’s market share or unit sales were concerned – I can agree with this.

                • Random Random

                  Those 23 million Symbian phones were also designed to be aging products. It was not possible to upgrade them. Just like WP.

                  Symbian devices were not compatible with each other. Calling something like that a standard can be done, but then again what’s the point with that if it’s not possible to have one application to work on those phones?

                  There has been a claim how Qt is easier to use, but nothing really to back up that claim. How can you know it’s like that? Someone just said how much easier it’s to use? Have they anything else but their opinion to back up that claim?

                  Elop’s decision can’t be the reason. Qt enabled Symbian phones were on the marker for over 4 months before Elop’s decision was published. In a comparable time iOS received lots of applications. There were 10 000 new applications released for iOS. We have absolutely no proof of that happening for Symbian’s Qt.

                  Yes. It was known in 2011 that WP, MeeGo or Symbian were not able to maintain Nokia’s unit sales in 2011. It was just not possible.

                  • Amusment

                    Windows is designed as product with programmed ageing – I agree. And it is not possible to upgrade it.

                    Windows devices are not compatible with each other. And it can’t be any standard, perhaps only inside 1% niche with Nokia Windows devices. This is just a mocking joke.
                    You also can’t have one application to work on all Android devices, anyway Android is still a standard, like Symbian was before.

                    Yes, they have applications created with Qt working perfectly. Also you can see Sailfish SDK on Qt and find out yourself. And positive opinion of many developers is a good measure, while your complains quite opposite IMHO.

                    “Elop’s decision can’t be the reason.” – yes of course Elop was the Nokia Messiah, he only has failed with redemption and all we need to suffer. iOS has received lots of software because the Apple was leaded by Jobs, while Nokia by Elop with his infinite wisdom. And I think there were 10 099 new applications released for iOS. We have absolutely no proof of that not happening for Symbian’s Qt.

                    Yes. It was known in 2011 that WP, MeeGo or Symbian were not able to maintain Nokia’s unit sales in 2011. It was just not possible.

                    • Random Random

                      Windows is not a standard making it possible to run the same software on every device. Just like Symbian wasn’t a standard making that possible.

                      About the Qt applications. We never saw those released in sufficient numbers during tho first 4 months. We saw the iOS apps when App Store was launched but there really never were enough of those Qt applications.

                      Qt just simply didn’t catch any traction during those four months. It’s not enough for a cross platform framework if it works. It should be widely used on mobile if the plan is to ship on mobile. Apparently Qt was never popular enough.

                      That’s why there is no reason why there would have been a migration path to MeeGo.

                      Why Apple succeeded? Perhaps they got some help from Steve Jobs who was a genius. It helps to have competent people as the managers.

                      Some people like to call Apple religion but in the end of the day they are just trying to use that for explaining something they don’t understand. Why Apple had a killer product and why the number of the features didn’t count.

                      Well.

                      It’s true that Nokia had no way of maintaining profits and unit sales in 2011. Elop had very little to do with that.

                    • burning nkia jumper

                      Elop was so good that now he is only a history. Thanks heavens!

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