Xiaomi Mi 5-16

Come September, Xiaomi phones including the Mi 5, Mi Max, Mi 4s, Redmi Note 3, and Redmi 3 will ship with popular Microsoft apps and services that directly compete with those offered by Google. This isn’t new for Microsoft, which has already struck similar deals with companies such as Samsung, Sony, and Asus.

The two companies have not shed any light on the financial aspects of the deal. What we know for sure is that Xiaomi’s phones and tablets will come pre-installed with Microsoft Word, Excel, PowerPoint, Outlook, and Skype for Android. For those not in the know, Microsoft Azure already powers the Mi Cloud service. You may have also heard of ways to flash Xiaomi devices including the Mi 4, Mi 5, and Mi Pad with Windows 10 ROM.

The deal will help Microsoft garner millions of users from China, India, and other developing markets where Xiaomi has a strong presence. The collaboration extends further than the bundling of a few apps though. As Reuters reports, the software-giant will transfer over 1500 patents to Xiaomi. Thanks to its patent portfolio, Microsoft has been minting truckloads of money from Android phone manufacturers including Samsung, HTC, and Acer.

Microsoft is scaling back its smartphone efforts, now aiming primarily at enterprise

Considering that Microsoft is not keen on investing resources in its Windows Phone division, it makes sense for the company focus on apps and services. Microsoft’s recent job cuts in the handset division are a clear indication that the current CEO Nadella does not share Ballmer’s enthusiasm for Windows Phone platform. Last year, he wrote off the $7.6 billion Nokia deal. It was followed by thousands of job cuts. He even let go of Stephen Elop, the executive vice president of Microsoft’s Devices Group. Interestingly, Joe Belfiore, responsible for Windows Phone development, has also been on a “holiday” for a long time.

Whether decisions such as abandoning the in-house Windows Phone division to focus on its services will help Microsoft win more revenue remains to be seen. However, it will definitely aid Satya Nadella show Microsoft’s balance sheet in green.