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Microsoft Pri0

Welcome to Microsoft Pri0: That's Microspeak for top priority, and that's the news and observations you'll find here from Seattle Times technology reporter Matt Day.

September 30, 2011 at 8:30 AM

Amazon in talks to buy Palm? Perhaps to avoid paying possible Microsoft licensing fees?

Buzz is swirling around a report in VentureBeat that Amazon is in negotiations to buy Palm from HP.

The VentureBeat story cites an anonymous, “well-placed source (who) tells us that HP is currently looking to rid itself of Palm as soon as possible, and that Amazon is the closest to finalizing the deal, among a handful of contenders.”

HP declined to comment on that rumor, reported VentureBeat, which added that it was waiting to hear back from Amazon.

The report, if true, has sparked speculation about why Amazon might be interested in acquiring Palm. For its hardware? For its webOS software that would mean Amazon could move away from the Google Android operating system that currently powers its just-announced Kindle Fire tablet?

One reason Amazon may be interested in adopting a different OS for its tablets is because it may end up having to pay royalties to Microsoft for using the Android OS. Microsoft contends that certain features in Android infringe on its patents. It’s reached agreements with seven companies that manufacture mobile phones and tablets, whereby the manufacturers pay Microsoft royalties for each of those devices produced, and is in litigation with an eighth – Motorola.

Microsoft and Amazon reached a patent cross-licensing agreement in 2010 that involves Kindles that existed at the time (as well as the Linux operating system).That agreement apparently does not cover Android.

Microsoft declined earlier this week to comment on whether it intends to either talk with, or a file a lawsuit against, Amazon over its new Android-based tablet.

We have a call in to Amazon and will update if they comment.

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