Microsoft used to say that Linux TCO was lower than Windows. Clearly that argument it totally inapplicable to consumer phones. Their choices are very limited at this point, so I expect the patent shakedowns to continue. So far, it is working like a charm... Amazon, Salesforce, HTC, etc. I see no reason why they'd stop.

Oh sure, they could try competing based on the quality of the product. But I think they realize this is too difficult for them to pull off now.