A lot of industry watchers were scratching their heads yesterday at news from Microsoft that it was buying Danger, the maker of Sidekick handset software, for an undisclosed sum. The Sidekick once stood out as an iconic image, with Paris Hilton and other pop culture figures holding their blinged-out versions aloft in photos. It’s been a relatively successful product for T-Mobile’s younger set—so much so that it’s now in its third iteration. But the iPhone and devices like Samsung’s Blackjack over the past two years have run circles around the Sidekick in sales and consumer awareness. What’s more, as my colleague Steve Wildstrom point out, Danger’s founder Andy Rubin, the driving force behind the company has long since moved on to brighter pastures at Google. He is working on the open-source handset software Android that has gotten so much attention. So why should Microsoft pay even a cent for Danger? At the Mobile World Congress in Barcelona, some of the analysts and industry players have offered a plausible theory. While Windows Mobile has been making steady headway in mobile device market share, its implementation still provides a fairly miserable experience handling multimedia. That makes it more a favorite device for corporations who want to standardize on a particular operating system—and one that doesn’t look too substantially different from what’s on their employees’ notebook or desktop pcs. Envisioneering analyst Richard Doherty points out Danger offers a nice patent portfolio that could give Microsoft fast access to consumer-oriented devices where people are less interested in the operating system but the experience and ease-of-use of the product. Microsoft used to try to segment devices based on price but has missed or ignored the fact that it needs more to segment devices based on user needs.Danger might be the software giant’s best attempt yet to compete with Linux-based devices and Apple’s OS X-based iPhone. Of course, the open question is whether enough good people will come over from Danger to help make sense of the roadmap. And then there’s the question of whether Microsoft will have the fortitude to move away, even if only slightly, from its beloved Windows operating system.
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