Cornered by Samsung in the Android ecosystem, Sony may attempt to diversify its mobile lineup through a partnership with Microsoft, insiders told TheInformation this week. The tipsters said that the two rivals are in talks to launch a Windows Phone device as soon as mid-2014, a narrow time frame that indicates the prototype designs are already in an advanced stage.

No technical specifications have been revealed yet, but the alliance between Sony and Microsoft reportedly hinges on the software giant’s willingness to reduce licensing fees. Redmond may even go as far as making its mobile operating freely available in a bid to attract manufacturing partners, SiliconANGLE learned last month, a move that could level the playing field against Google.

While Android is open source and technically available for no cost, a string of patent litigation victories for Microsoft has forced Samsung, HTC and other top OEMs to pay steep royalties for every handset shipped with the search giant’s operating system. Offering the only truly free mobile OS cloud could go a long way towards improving the firm’s position in mobile industry, especially in view of its rumored plans to substitute the lost licensing revenue with advertising and subscription services like Office and SkyDrive.

The alliance, if materialized, would also represent a major victory for Sony. The consumer electronics giant commands just over five percent of the Android market compared to Samsung’s 63, and a Windows Phone device may be what it needs to gain some much-needed growth momentum in the broader market. But Microsoft’s $7.7 billion acquisition of Nokia, the biggest maker of Windows Phone hardware, will put tension on the partnership and make it more difficult for Sony to compete in the long run.