EDD revenue increased, primarily due to higher Xbox 360 platform and Windows Phone revenue. Xbox 360 platform revenue increased $641 million or 55%, primarily due to the recognition of $380 million of revenue related to the Video Game Deferral and higher Xbox LIVE revenue. Windows Phone revenue increased $259 million, including patent licensing revenue and increased sales of Windows Phone licenses.
EDD operating income increased, primarily due to revenue growth, offset in part by higher cost of revenue and research and development expenses. Cost of revenue increased $275 million or 23%, due mainly to increased royalties on Xbox LIVE content and video games. Research and development expenses increased $113 million or 28%, primarily reflecting higher headcount-related expenses.