Just licensing I believe, at least in straight up payments. The fact that Nokia are completely dedicated to WP7 is a big advantage to Microsoft in terms of product visibility, both in stores and with ads. Not to mention that Nokia has much better carrier relations than Microsoft does. So I think the money is probably well spent on Microsoft's part.

So that came from the EDD I take it ... another reason for lower than expected profits.

Well 250 million doesn't sound bad, especially when they spend bilions on Danger (Sidekick) and the Kin project.. but 250 million is just the first payment..that's what? like 250 dollar on each Lumia sold this quarter? (I know it doesnt work that way but still...) I do hope it pays out in the end... they are nice devices, good OS and competition is always good..

Kinda laughable that MS has to pay a carrier to adopt its platform. Nokia indicated it supposed to be receiving 'billions' from the transaction, Microsoft never learns. More wasted money.

I think it will. Nokia is only just getting started, and if the rumors are anything to go by, they'll be rolling out new WP7 phones quite every quarter or so. Here in Denmark, Nokia's really been turning up the marketing blitz with almost every carrier doing lots and lots of advertisement over the Lumia 800, with very positive results too, going by comments from the carriers at least.

Combined with the Tango update (which will improve WP7 for lower end devices) and I think we'll be seeing a big range of WP7 devices from Nokia.

Why is it laughable? It's not a big OS so of course they're going to need to offer incentives for Nokia to be Windows exclusive ...

Speculate to accumulate and all that

Sorry, but as android grabs more and more tablet/smartphone/ and especially feature phone market share, Nokia will have a harder time going up against android.

-Android phones win on the specs/price ratio and this is probably the key metric for nokia's traditional strength, that is budget phones. That's why android is so far taking more and more feature phone market share away from MS platforms, even though only five years ago, MS had 75 percent of this market.
-Android is getting more and more developer attention, so the monetization of the platform is better. Developers want market share on a platform if they are going to make software for it
-android is getting more and more tablet market share, so they are going to be a better competitor all the time..... right now, MS tablets have about 2 percent market share which isn't good

-MS is turning into something like a stodgy old industrial firm, getting only 8 revenue on a yearly basis and they don't have a lot of new markets left that really make sense for the company, so I see why they want the smartphone market so much. Meanwhile, google has about 20 yearly revenue growth or if not, it's in the high teens, so they're going to rush in and try to be really aggressive as that's their thing I guess

I got teh HTC WP7 for now, wanting Nokia lumia quite badly, WP7.5 is a decent OS.

Of course they'd have to pay for exclusivity from one of the oldest and best phone manufacturers, how people would call this a waste is beyond me, Nokia is a well known brand, taking into account that the only way to get one would be on WP7 is quite an advantage, now they just need to make them more accessible in terms of price.

Microsoft are working hard on lowering the hardware requirements for WP7 though, so Nokia should be able to make fairly cheap smartphones soon. 

As for tablets, I don't think they're going to be a problem once Windows 8 is out. Apps for Windows 8 are going to work universally on any desktop, laptop or tablet, and generating developer interest shouldn't be a problem for Windows.