"People familiar with the matter say Microsoft is putting money into Cyanogen, which is building a version of the Android mobile-operating system outside of Google's auspices," a report in the Wall Street Journal stated.

CyanogenMod operating system for smartphones and tablet computers, is based on the Android mobile platform.

Meanwhile, the main engine of Microsoft's historic earnings power - selling Windows and Office to big businesses - is showing signs of waning, and investors are concerned that the shift to the cloud is not making up for the shortfall.

Shares of the world's largest software company fell more than 4 percent after hours on Monday, as it forecast a slight sequential dip in commercial licensing sales this quarter, and only a modest increase in cloud-based revenue over the quarter just ended.
The shift from the old model of selling software to companies to install on their own computers - charged as a license fee - to a cloud-based model where customers pay a regular subscription, is generally viewed as a positive move for Microsoft. But the path to the promised land may not be smooth.
Meanwhile, Microsoft is forecasting modest growth in its emerging cloud-based businesses. It now expects revenue of $2.6 billion to $2.7 billion from a bundle of commercial services, including its Azure cloud platform, compared to $2.6 billion in the latest quarter.