From a pure financial basis I would wager good money that Android is more expensive for manufacturers than Windows Phone is, not even including the Microsoft patent tax (where it most certainly is more expensive for any vendor who signed on), in the same way that Linux was actually more expensive for Dell to put on a laptop than a full copy of Windows was.

When Samsung or Motorola or HTC or LG decide to go with Android they commit themselves to significant software engineering expenses. Those who try to under-fund those activities suffer in the market (Motorola and Sony being two prime examples).

Windows Phone, in contrast, is built to put the vast majority of the software engineering costs on Microsoft's side, and the activities required by a hardware vendor are dramatically reduced.

I only mention this because there's a recurring, very detached from reality theme that vendors choose Android because it is "free" (excluding the possibility that vendors have to license the non-ASOP Google apps and services). That might be true for the cheapest of the cheap devices, but it is completely untrue for the top tier makers.

The price for moving all the porting effort to Microsoft is inflexibility. For example, WP7 supported only Qualcomm SoC and nothing else. Meanwhile, in the Android world, the vendors (mostly SoC vendors) had to do engineering, but they could use Exynos or Tegra or any other SoC they wanted.

Another significant part of the engineering is customization. It is not that we, the geeks, want the manufacturers to customize their Android builds (see the popularity of the Nexus and AOSP builds for other phones). But they have a choice and they chose to do it. In the Windows world, they don't have such a choice.

So it is not a black/white. It is a set of compromises and constrains on a curve. It is up to a vendor to pick the optimal point, after weighting costs and benefits.