Microsoft ditches its smartphone Kin

By Stephen Foley

NEW YORK - Microsoft has scrapped the UK launch of its social-networking smartphone, the Kin, and announced it will discontinue the product in the US after just eight weeks, chalking up another failure in its attempts to match Apple in the consumer electronics market.

Robbie Bach, who leads Microsoft's entertainment division, which developed the Kin, was pushed out in May and his successors took an early decision to abandon the project.

An advertising campaign failed to counter hostile reviews for the phone and sales proved terrible.

The Kin had been slated for launch in the UK in September, via Vodafone.

Although the phone claimed to offer an all-in-one social networking experience, it suffered by comparison with smartphones such as the iPhone, for which users can choose from a menu of thousands of third-party applications to broaden the range of things the phone can do.

"The phone was ill-conceived from the beginning," said Shelly Palmer, the founder of Advanced Media Ventures.

"Everybody in smartphones thinks they are competing with Apple, but they are not. They are competing with Apple plus an army of third-party developers. They completely misunderstood the marketplace. Every other phone out there has more features than the Kin."

Microsoft's pursuit of the cool factor in consumer electronics hardware has led it into several notable disasters, including the Zune, a digital music player launched in 2006 as a serious rival to Apple's iPod. Only its Xbox gaming console has proved to be a hardware hit.

The company said its smartphones division would now concentrate on software and on the launch of Windows Phone 7, the forthcoming version of its mobile operating system, which it hopes will become as ubiquitous on phones as Microsoft Windows is on personal computers.

"We are integrating our Kin team with the Windows Phone 7 team, incorporating valuable ideas and technologies from Kin into future Windows Phone releases," a spokesman said.

Ronan de Renesse, the head of mobile media at Screen Digest, said Microsoft was falling further and further behind in the battle for market share in smartphones.

Last year, Windows software powered 14.2 million smartphones sold around the world, placing it fourth behind Nokia's Symbian and the operating systems for Blackberry and the iPhone.

This year, Microsoft has been leapfrogged by Google's new, free operating system Android, which is attracting strong interest from third-party developers.

More than twice as many Android phones will be sold this year than Windows phones.

Renesse said Microsoft's early start in phone software was now a handicap.

"In 2003 and 2004, the market was completely different. Smartphones were targeted at a business audience, not at the consumer. The switch happened with the launch of the iPhone, and now the market is accelerating and you have to be able to adapt quickly to consumer and developer demands.

"I don't understand why Microsoft isn't building on its successes," he said.

"I don't understand why they aren't building on [the Xbox] gaming platform."

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