“Microsoft Corp. will pay Nokia Oyj more than $1 billion to promote and develop Windows-based handsets as part of their smartphone software agreement, according to two people with knowledge of the terms,” Dina Bass reports for Bloomberg.

“Nokia will pay Microsoft a fee for each copy of Windows used in its phones, costs that will be offset as Nokia curtails its own budget for software research and development, said one of the people, who declined to be identified because the final contract hasn’t yet been signed,” Bass reports. “The agreement runs for more than five years, the people said.”

Bass reports, “Nokia shares have dropped 26 percent since the accord was unveiled Feb. 11, reflecting doubts about the move to adopt Microsoft’s operating system, which is less than six months old and has just a few percentage points of market share.”

MacDailyNews Take: Windows Phone ’07 has “a few percentage points of market share?” Says who?

Read more in the full article here.

MacDailyNews Take: You might be a Ballmer if… you have to pay a floundering company over $1 billion to use your mobile OS.