Nokia and Microsoft said on Thursday that the two companies have signed an agreement worth "billions of dollars" to put the Windows Phone OS on Nokia handsets, along with other collaborations.

"In recognition of the unique nature of Nokia's agreement with Microsoft and the contributions that Nokia is providing, Nokia will receive payments measured in the billions of dollars," the two companies said in a joint statement.

However, Nokia won't be the only company getting paid in the now-official deal.

The two tech giants said Microsoft was going to receive "a running royalty from Nokia for the Windows Phone platform, starting when the first Nokia products incorporating Windows Phone ship."

Just how much the royalties would add up to wasn't disclosed, but the companies said "the royalty payments are competitive and reflect the large volumes that Nokia expects to ship, as well as a variety of other considerations related to engineering work to which both companies are committed.

"Microsoft delivering the Windows Phone platform to Nokia will enable Nokia to significantly reduce operating expenses."

The exact length of the long-term deal between Microsoft and Nokia wasn't disclosed Thursday, but the first Nokia phones running the Windows Phone OS are scheduled to land in stores by 2012.

The two companies also said they've made "significant progress on the development of the first Nokia products incorporating Windows Phone" and have assigned hundreds of employees on getting the new smartphones out into the market.

The agreement also calls for the upcoming launch of a new Nokia-branded "global application store" built on the Windows Marketplace infrastructure to sell apps for Nokia devices.

The new Nokia storefront for mobile apps will allow developers to publish and distribute applications "through a single developer portal to hundreds of millions of consumers" that use the Windows Phone OS, Nokia's internally built Symbian OS and other Nokia phones, the statement said.

Microsoft is doing some advance work that is currying customer satisfaction -- by launching a "Where's my phone update?" site for Windows Phone 7 users who are eagerly awaiting the newest software upgrades.

With an update for its mobile operating system rolling out with some bumps and mishaps, the site breaks down future software updates by device in the U.S. and by operator in other countries.

The software rollouts are broken into three stages: "Testing" means the update is being assessed by mobile network operators, "Scheduling" means Microsoft is deciding on a release date for the update (usually within 10 days, according to the website), and "Delivery update" means updates are available to customers.

However, even when an update is in the delivery phase, "it might take several weeks before you receive notice that an update is available for you," the site warns.

In the U.S., updates for the HTC Surround, the LG Quantum and the Samsung Focus are in the "testing" phase, while those for the HTC HD7 and Dell Venue Pro in the "scheduling" stage.

The current "NoDo" update for Windows Phone 7 includes copy-and-paste capability, easier browsing functionality, better syncing with Facebook and other performance enhancements.

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Photo: The HTC HD7, which is listed in the "scheduling" phase of a software update. Credit: Microsoft Corp.

Microsoft has agreed to pay Nokia more than $1 billion to release smart phones running the Windows Phone operating system in a still-unsigned deal between the two companies, according to a report.

That money will be paid out over a five-year span, with some of it coming up front to help fund Nokia's development and marketing of the new line of phones, which have yet to be given a release date, according to a report from Bloomberg.

Microsoft, which launched Windows Phone 7, the latest version of its smart-phone OS, last fall, will be paid back royalties for each handset Nokia sells when the phones hit the market, Bloomberg said, citing two unnamed sources on the details of the agreement.

One of the Bloomberg sources said the contract hasn't been finalized or signed and that no timetable for when that might happen was offered. 

In a joint news conference with Microsoft Chief Executive Steve Ballmer, Nokia CEO Stephen Elop announced last month in London that the cellphone maker was choosing Windows Phone over Google's Android or even its internally developed Symbian as its main operating system for smart phones.

Elop, who was a Microsoft executive before heading over to run Nokia last September, made the announcement days after he reportedly sent a company memo in which he said Nokia was "standing on a burning platform" with "more than one explosion -- we have multiple points of scorching heat that are fueling a blazing fire around us."

In February, at the London announcement, Elop and Ballmer said Nokia and Microsoft were already working together on developing a line of phones running Windows Phone software, despite not having a contract signed back then.

Microsoft said then that it would gain access to Nokia's worldwide mapping and navigation services, as well as to large cellphone carriers in international markets that it hasn't had before.

Nokia accounted for about 41% of the global mobile phone market in 2008, but that number fell to about 31% in 2010, according to the Associated Press.

Despite the falling numbers, Nokia remains the world's top seller of mobile phones, but in January, Android dethroned Nokia's Symbian smart-phone operating system as the world's most used mobile OS.

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Top photo: Microsoft CEO Steve Ballmer delivers a speech about the alliance between Microsoft and Nokia during the 2011 Mobile World Congress, held in Barcelona, Spain, on Feb. 14, 2011. Credit: Toni Albir/EPA

Bottom photo: Stephen Elop, CEO of Nokia, speaks during an interview with the Associated Press at the Mobile World Congress in Barcelona, Spain, Monday, Feb. 14, 2011. Credit: Manu Fernandez/AP Photo

Apple is in talks with record companies to allow users to download music tracks they buy on iTunes to any iTunes-enabled device, Bloomberg reported Friday. That would presumably mean any song you buy for your iPhone could then be downloaded multiple times (for no extra cost) to your iPad, your Mac or your PC.

In many ways this move is exactly in line with what other media publishers have already started to do -- let users pay once, and use anywhere.  That way, users can forget whether they first bought a book or television show for a specific device, and just watch it whenever and wherever they want.

Apple, which now controls a huge chunk of the music business through iTunes, also wants to get to that place of ultimate convenience, and has been moving in that direction for some time.

The company has already got AirPlay, which lets users play songs from any iTunes device through an Apple TV.  And this week Apple said the new version of its iOS operating system will enable users to play music and video stored on one device on the screen of a second device, over WiFi.

If and when Apple gets the music industry to agree to repeated downloads, there's no longer any real barrier to cloud-based, streaming music -- where listeners won't have to wait for downloads, because they'll be able to immediately play any song in their online music collection.

The e-book industy has largely pioneered this approach:  If you buy an Amazon e-book, you can download it to your Kindle, your PC, and any smartphone or tablet with the Kindle app installed.  The same is true for books bought through Google. Even Apple's iBookStore allows users to sync their books between the iPhone, iPad and iPod Touch.

This is increasingly also the case with movies and TV shows, where services like Netflix allow users with monthly subscriptions to watch movies and TV on any Netflix-enabled device, whether that's a Roku box or a TiVo, an iPad, an iPhone, Windows Phones and soon, Android.  You can watch these movies and films as many times as you want.

Though newspaper and magazine publishers are a little further behind the game, they''ll all be multiplatform soon too.  The for-pay Wall Street Journal, already on the iPad, was early in releasing an Android app, and magazine publisher Condé Nast has said Android additions are on the way too.

When it comes to ease of accessing content you've bought online, the only real holdout is the music industry. 

On the league-leading iTunes system, users have long been frustrated with their inability to keep all their purchased music in one central place.  The result is often a set of Apple devices -- a Mac, an iPhone and an iPad, say -- all with different fragments of your music collection.  That collection, incidentally, does not reside on a remote server, but on your own devices -- so if you've been downloading music from Apple for years on a series of devices, it becomes a confusing jumble. 

That's why Bloomberg's report makes sense:  Apple doesn't like clutter.  What they like is allowing people to easily buy things, and be able to access them without friction -- the better to get people to buy even more.

The remaining question may be:  If the record companies jump on board with this model, will they let users who bought songs through Apple listen to the songs on non-Apple devices? 

Or would that be too easy...

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Nokia is set to pair its hardware with Microsoft's Windows Phone software in an effort to fend off the increasing success and competition from its rivals; Apple's iPhone, Google's Android operating system and Research In Motion's BlackBerry handsets.

The Finnish company made the widely expected decision official on Friday morning during a London news conference. 

"The entire smart phone market is growing rapidly, and we should be setting the pace," said Nokia Chief Executive Stephen Elop. "The game has changed. The game has changed from a battle of devices to a war of ecosystems."

In a Nokia internal memo leaked to the media Wednesday, Elop used much more dramatic language, writing that the company was "standing on a burning platform" with "more than one explosion -- we have multiple points of scorching heat that are fuelling a blazing fire around us."

Microsoft's Windows Phone software, currently in its seventh iteration, will replace Nokia's Symbian operating system on the majority of handsets from the company after the two firms complete a partnership agreement, Elop said.

Neither Nokia or Microsoft offered any specifics dates on when the agreement between the two tech giants would be finalized or when the first Nokia Windows Phone would hit retail, though Microsoft CEO Steve Ballmer said the process had begun.

"We're already working together to create the first Nokia Window's phones, and we've reached out to chip vendors, mobile operators and developers, and you'll hear more from us in all of those areas over the next weeks and months," Ballmer said.

The agreement will also give Microsoft access to Nokia's worldwide mapping and navigation services and access to large cellphone carriers in international markets that it hasn't had before, Elop and Ballmer said in a statement.

"In this partnership with Nokia, Microsoft brings its Windows Phone software and the brands mobile consumers want like Bing, Office and of course Xbox Live," Ballmer said Friday.

Nokia's mapping and navigation technology will be integrated into Microsoft's mapping services, such as maps used in the Bing search engine, and Microsoft's adCenter business will also sell and distribute ads across Nokia phones, the companies said.

Although Nokia is choosing Windows Phone 7 as its main strategy in smart phones, the company made clear that it is not planning to completely abandon its Symbian and under-development MeeGo operating systems.

Once the "long-term strategic alliance" is finalized, it will end up as a major departure from Nokia's past strategy in the smart-phone market, which had the home-grown Symbian at the core.

In January, Android dethroned Symbian as the world's most used smart-phone operating system -- a title Symbian had held since the inception of the market about a decade ago. Google's Android OS is comparatively young, having debuted in 2008.

Elop is fairly new to Nokia, having been hired as CEO last September from a senior executive position at Microsoft. He is also the first non-Finnish citizen to run Nokia, a company that is looking to him to turn around its large losses of market share in crucial markets such as the United States and Asia.

Nokia accounted for about 41% of the global mobile phone market in 2008, but that number fell to about 31% in 2010, according to the Associated Press. Despite the falling numbers, Nokia remains the world's top seller of mobile phones.

Below is a video of the Nokia news conference with Elop and Balmer.

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Photo: Nokia CEO Stephen Elop (left) and Microsoft CEO Steve Ballmer announce that Nokia will carry the Windows Phone as its main smart phone platform during a news conference Friday in London. Credit: Nokia / Getty Images

Video credit: NokiaConversations via YouTube

Last year, 26% of apps on iPhones, iPads, Androids, BlackBerrys and Windows Phones were discarded after just one use, according to a study by a mobile app analytics firm.

"The thing that grabs headlines is 26% of people throughout the year only use it once, but you could turn this around and look at this as 74% of people use an app more than once," said Brian Suthoff, vice president of market development at Localytics, the company that performed the study. "It's actually very positive for developers. It shows that people are willing to try something out and test it and see if they like it on mobile devices."

Localytics, a firm that sells real-time analysis data of app usage to mobile app developers, conducted its study using data from only its customers. It didn't look at the usage rate of every app available -- which includes more than 400,000 iOS apps and more than 200,000 Android apps.

Suthoff declined to give an exact number of how many apps it looked at for the study, but said there were thousands.

The Boston-based company put out the study to help sell its own services, but also to question a bit the way the success of an app is measured, he said.

"As an analytics company we think that focusing on understanding how people engage with your app over a longer period of time is more important than looking at just the number of downloads an app has," Suthoff said. "Developers need to figure out what type of people use their apps and how to attract those type of people for the first time and as returning users. Raw download numbers don't tell the whole story."

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Photo: Jerry Penacoli looks at his iPad after purchasing it an an Apple store in Los Angeles. Credit: Irfan Khan/Los Angeles Times

LG said Microsoft's Windows Phone 7 line hasn't lived up to expectations so far, according to a report.

James Choi, a marketing director at LG, said phones running the rebuilt Windows operating system for smart phones launched in October with high industry expectations, but consumers haven't yet taken to the handsets as hoped, according to a report from Pocket-lint.

In an interview with Pocket-lint, Choi said one problem might be that the Windows Phone 7 OS might be too easy to use for the tech-savvy.

"For tech guys like us it might be a little bit boring after a week or two, but there are certain segments that it really appeals to," Choi said. "We strongly feel that it has a strong potential even though the first push wasn't what everyone expected."

Both LG and Microsoft have been working together on phones running Windows Phone 7 "from the beginning," and Choi told Pocket-lint that Microsoft's OS is "absolutely perfect for a huge segment out there. What we feel is that some people believe that some operating systems, mainly Google, are extremely complicated for them."

So, despite the phones not yet selling as expected, LG isn't planning on dumping Windows Phone 7, Choi said. Currently, LG makes one Windows Phone 7 handset available on AT&T -- the LG Quantum.

"Being dependent on one OS is not beneficial for us," he said. "That's the same with not just the manufacturers, but the operators as well."

Choi also said cheaper smart phones running Windows Phone 7 might help boost its market share.

"There is a lot of skepticism at the moment, but once Windows Phone 7 handsets that are mid-tier to low tier start appearing the market share will grow," he said. "Right now it's only exclusively present in a high tier, because of its hardware requirements, and that's limiting growth."

Microsoft officials weren't available for comment on Friday, but the company has said in the past that 1.5 million Windows Phone 7 handsets were sold in the six weeks following launch.

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Photo: Microsoft CEO Steve Ballmer holds a Windows Phone 7 smart phone during his keynote speech at the 2011 Consumer Electronics Show on Jan. 5 in Las Vegas. Credit: Robyn Beck/AFP/Getty Images

Windows Phone 7 has sold 1.5 million units in its first six weeks on the market, Microsoft says.

But the tech company might want to hold off on popping the champagne. The numbers represent sales to retail stores and carriers. Device sales to customers are probably far lower.

And to compare with competitors, Apple sold nearly 2 million iPhone 4s in just two days. And when it comes to attracting more Android users, Google’s no slouch either.

Microsoft seems to realize that it doesn’t get much in the way of bragging rights from the 1.5-million figure, which was tucked deep into an interview with mobile operations vice president Achim Berg on the company website.

Since going on sale in November, devices made by companies such as Samsung and HTC but operating with the Windows Phone 7 system have seen mild interest at best.

But sales are “in line” with Microsoft’s expectations and are “ramping well as our reputation is growing for offering users a unique experience,” Berg said. The company is planning to begin releasing updates in the next few months and expand its network of mobile operators and manufacturers.

“We know we have tough competition, and this is a completely new product,” he said. “We’re in the race --  it’s not a sprint but we are certainly gaining momentum and we’re in it for the long run.”

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Microsoft unveiled a slew of new mobile, local, travel and social-media features for Bing in an effort to make the search engine more competitive with search-industry leader Google.

One new feature aimed at social media fans is the option to rank search results based on what a Bing user's friends have "liked" on Facebook.

Microsoft also updated its Bing mobile apps -- for smart phones such as the iPhone, Android and Windows Phone 7 handsets -- to enable users to make reservations using the popular OpenTable service or order takeout using Grubhub, all from within the app.

Once checked in to a restaurant using OpenTable, a Bing app user can then "check in" at the restaurant using social-media location services such as Foursquare and Facebook Places.

Another new location-based feature for the Bing apps are reminders that users can set to pop up on their smart phones when Bing recognizes that its near a specified business or place.

Bing apps also are gaining Microsoft's Streetside feature, which is similar to Google Maps' Street View. Streetside feeds panoramic photo views of city streets to the app's maps function.

Real-time public transportation information has also been added to the Bing apps. The travel info will tell users if a bus or train is running early, on time or delayed, and the app can offer predictions for arrival times.

For now, transit routes for 11 metropolitan areas are live including Boston, Chicago, Los Angeles, Minneapolis, New Jersey, New York City, Philadelphia, San Francisco, Seattle, Washington, D.C., and Vancouver. More cities will be added in the future.

One feature that isn't available yet, but that Microsoft said it's working on, is in-Bing-app ticket-buying for sports games and other events using a service called FanSnap.

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Images: Screen shots of new Bing app restaurant check-in features on an Apple iPhone. Credit: Microsoft

Facebook announced updates to the privacy controls of its mobile websites and smart phone apps today, which will include the same privacy options already available on facebook.com itself.

"In October, we added a dashboard to give you a way to clearly see and control the ways applications use your information,"  Rose Yao, Facebook's mobile product manager, wrote in a blog post. "We're making these same controls available on your mobile phone so you can update and manage the information you share from wherever you want."

The updates will allow users of Facebook apps and mobile site to see in more detail the information they're sharing with various applications and websites, as well as the ability to adjust those settings.

Facebook's mobile sites, m.facebook.com and 0.facebook.com, were updated today and Facebook mobile apps on Android, BlackBerry, the iPhone and iPod touch, and Windows Phone will get the same updated privacy controls over the next few weeks.

With the update, users will be able to adjust access for applications and other Facebook users to basic profile information, photos and videos.

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Image: Updated privacy controls on Facebook's mobile website, demonstrated on an iPhone. Credit: Facebook

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