Microsoft inks patent-licensing agreement with Hon Hai

Hon Hai Precision Industry Co Ltd, the parent of Foxconn, today signed a patent-licensing agreement with Microsoft in order to protect itself and its clients from being sued for using Google's Android and Chrome operating systems.

Google and Microsoft have filed patent suits against each other, with the software giant alleging that some parts of Google's Android operating system infringes on its software patents. Microsoft has recently targeted mobile handset manufacturers for patent violations rather than Google itself.

Hon Hai, the world's largest contract manufacturer, will pay Microsoft royalties in exchange for "broad coverage under Microsoft's patent portfolio."

Under the terms of the deal, Hon Hai will pay Microsoft a flat fee for every Android and Chrome-based device that Foxconn makes.

The fees will be substantial since around 40 per cent of the world's phones are made by Foxconn at its factories in China. Hon Hai is also a contract manufacturer for tablets and PCs for several tech companies, including for Apple, Nokia, Dell, Sony and others.

By concluding this agreement, Microsoft said it now has patent protection deals in place with most of the hardware makers that produce more than half the world's Android smartphones.

Earlier, Microsoft had concluded similar agreements with other hardware manufacturers, including Samsung Electronics, LG Electronics, Barnes & Noble, Acer, HTC, ViewSonic, Nikon, Compal Electronics, Quanta Computer, and Wistron.

Although many companies have settled their patent lawsuits with Microsoft over their use of Android, Motorola Mobility, a unit of Google, continues its patent battles with Microsoft in courts in the US and Germany.

Since Microsoft launched its IP licensing program in December 2003, the company has entered into more than 1,100 licensing agreements.

"We are pleased that the list of companies benefiting from Microsoft's Android licensing program now includes the world's largest contract manufacturer, Hon Hai," Horacio Gutierrez, corporate vice president and deputy general counsel of the Intellectual Property Group at Microsoft, said in a statement.

"By licensing both brand name companies and their contract manufacturers, we have successfully increased the overall effectiveness and global reach of the program," he added.

''Hon Hai is the world's largest contract electronics manufacturer that holds more than 54,000 patents worldwide,'' said Samuel Fu, director of the Intellectual Property Department at Hon Hai.

''We recognise and respect the importance of international efforts that seek to protect intellectual property. The licensing agreement with Microsoft represents those efforts and our continued support of international trade agreements that facilitate implementation of effective patent protection.''