Microsoft Investing in Cyanogen

The software giant is making an investment in a hot startup that’s attempting to weaken Google’s hold on Android. According to individuals that are familiar with the matter, Microsoft is investing in Cyanogen, which is developing a new version of the Android mobile operating system that will be outside the auspices of the search engine giant. Cyanogen is valued in the hundreds of millions because of the $70 million of equity financing and Microsoft will only be a small investor in the firm. The individuals aware of the matter said that growth could be seen in the financing round because of other strategic investors that had also shown their interest in Cyanogen as they also want to reduce Google’s control on the Android OS.

However, the identity of the other possible investors of Cyanogen wasn’t revealed. No comment was made by spokespeople from Cyanogen or Microsoft. This comes off as an unusual investment for Microsoft because it already has its own Windows Phone mobile operating system. The problem is that this OS of the company only holds 3% share of the market, which may have forced the company to opt for some unconventional measures to compete in the global smartphone market.

When Android had been first introduced, it was supposed to be an open-source operating system, which could be deployed by hardware makers in their devices without any charge. Yet, in recent years, manufacturers have become increasingly frustrated because they are required to features apps of Google and set Google search as their default. In return, the users are able to gain access to YouTube, the search engine and the millions of apps that are available in the company’s Play Store. Because of such restrictions, it is extremely difficult for apps that are competing with Google in order to win distribution on devices running on Android OS.

For Microsoft, this means that its Bing search engine has less exposure as compared to Google’s search engine and growth of other products of Microsoft are also limited. An alternate version of Android OS is being offered by Cyanogen, which is free of any such restrictions. This company only has 80 members, but it claims to have 9000 software developers that are working on a voluntary basis. The chief executive of Cyanogen, Kirt McMaster, said that they intended to take Android away from Google. It had been reported before that the company had raised $30 million in funding, but McMaster said that they had now collected $100 million.

He also added that their version of the Android operating system was being used by about 50 million people. He said that most of them had installed this version in their phones by removing the original version of the OS. In order to promote early adoption, the company is attempting to make deals with hardware makers for installing their software on their devices. A deal was recently signed with Micromax, an Indian smartphone maker for shipping handsets based on Cyanogen’s software and other such details will also be announced soon.

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