Microsoft Corp said on Tuesday it struck a licensing deal with phone handset maker HTC Corp, under which it will get royalty payments on HTC phones running Google Inc's Android operating system.

Microsoft, which holds a wide range of software patents, did not say exactly what technology in the phones the agreement concerns.

The deal comes as smartphones using Google's new operating system -- which Google allows phone makers to use for free -- gain in popularity. Microsoft charges handset makers like HTC and others to use its Windows phone software.

The smartphone market is riven with legal disputes as software companies and handset makers wrangle over who deserves compensation for technology behind new devices which go well beyond traditional mobile phones.

In March, Apple Inc sued HTC over its Android phones, accusing it of infringing 20 hardware and software patents related to the iPhone. HTC makes a number of Android-powered phones, including the Google-branded Nexus One.

Tuesday's deal signals that Microsoft is not likely to start a similar legal patent dispute with HTC over Android phones. Licensing arrangements are standard procedure for Microsoft, which has similar deals with more than 600 companies.

(Reporting by Bill Rigby; editing by Carol Bishopric)

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