What exactly were Microsoft and Nokia discussing if it wasn’t a buy-out? #

Rafe Blandford takes a look at some of the issues around the latest Nokia/Microsoft buyout rumours from the WSJ:

Such talks could be around an acquisition, but other options might also be on the table, such as Microsoft taking a stake in Nokia, as it did with Apple in the late nineties. An alternative option would be the modification of its current Windows Phone licensing deal with Nokia. Microsoft has been making platform payments to Nokia to offset some of the costs associated with switching to Windows Phone, while Nokia has been making software license payments to Microsoft. As a result there has been a net flow of money from Microsoft to Nokia. However, this flow is set to be reversed in the second half of 2013, as total licensing payment increase with device volume, and the platform payments come to and end.

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