There’s been a lot of attention on the amount of money Microsoft is making from Android, including Microsoft’s own proclamations. Maybe it’s just that I’m more of a fan of Linux and open source software, or maybe I’m overly focused on the lawsuits and threats against Android, but I see serious downsides to all of those dollars for Microsoft from Android.

I believe Microsoft’s strategy to pursue patent licensing deals rather than sue, as we’ve seen from Apple, may prove to be a more effective strategy. Rather than limit or destroy Android, Microsoft is actually supporting its growth, meaning more Android devices and users in the market. Since it’s making so much money from Android, Microsoft may be less interested in limiting or attacking it, so that’s a benefit to Android. However, I do see some significant drawbacks to Microsoft’s Android strategy, all of which serve to limit Microsoft’s opportunity in the future.

First, Microsoft’s Android licensing is a validation of Android. Many if not most of the companies using Android that are also Microsoft licensees all seem to be doing well enough and making enough money to go ahead and pay Microsoft’s licensing fees. This highlights Android’s growth and spread, which is tied to significant market gains for companies such as HTC, Samsung and Verizon. One might argue that Microsoft’s Android licensing revenue will similarly rise with the Linux-based mobile operating system’s growth, but I don’t see that happening, and the second drawback I discuss next is the reason.

Second, we’ve already seen Samsung working to sidestep technology and patents in question that have caused courtroom fights or market bans around the world. I expect all of Microsoft’s Android licensees are working to similarly work around technology in question, so there is a shelf life on Microsoft’s IP licensing business. The details of these patent deals are not public to us, but the companies that agree to them have a much better handle on which technology is problematic since they’re the ones signing. I expect we will see these deals peak at some point and over time, they will become less relevant to Android backers and less lucrative to Microsoft. In addition, for all of the criticisms regarding its openness, Android has a global, open source development community behind it. That means it will be able to compete, innovate and work around things quickly. Those workarounds will likely make their way into the greater Android community so that supposed patent infringements will decline and eventually disappear.

The third drawback is a matter of pride. At the same time Samsung officials signaled an effort to sidestep IP-sensitive technologies and issues, a Samsung executive expressed concern that these patent suits and fights may come at the expense of pride in brand and company. I couldn’t agree more. It really does say something if Microsoft is making more money from IP licensing of non-Microsoft technology than from its own work in smartphones — perhaps the hottest technology market on the planet right now. Consumers may not be aware of or care about lawsuits, license deals or pride, but developers do.

Given some new indications there may be a change at Apple and a bridge to Samsung whereby settlement, progress and choice take priority over market bans and destruction of an ecosystem, these drawbacks for Microsoft may be even more significant going forward.