Microsoft Kills the Kin

Microsoft is killing its Kin "social phones" after less than seven weeks on the market.

The news comes after two weeks of suspicious reports on abysmal Kin sales and just three days after Verizon slashed Kin prices nearly in half. Microsoft, which launched the Kin One and Kin Two in May, did not explicitly confirm the discontinuation but sent seattlepi.com the following statement.

"We have made the decision to focus on our Windows Phone 7 launch and we will not ship KIN in Europe this fall as planned. Additionally, we are integrating our KIN team with the Windows Phone 7 team, incorporating valuable ideas and technologies from KIN into future Windows Phone releases. We will continue to work with Verizon in the U.S. to sell current KIN phones."

The news also comes one month after Microsoft CEO Steve Ballmer ousted two high-profile lieutenants from the company's consumer-devices division, and further illustrates Microsoft's ongoing struggle to remain relevant in the age of mobile computing.

The phones, targeted at "generation upload," were the result of months of product development that generated some unusual buzz among tech enthusiasts. Known for some time as"Project Pink," the Kin program was largely seen as Microsoft's first attempt at reinvigorating the Sidekick technology the company inherited when it acquired Danger in 2008.

Microsoft unveiled the two Kin devices -- the first phones to feature bits of Windows Phone 7 -- in April and released them with Verizon in May. Though Microsoft called them "smart phones," they were not; the user interface was geared entirely toward social networking and lacked support for third-party applications.

The software superpower marketed them at teens to 25-year-olds whose lives revolve around Facebook, Twitter, instant messaging and other social media. Redmond launched a daring new media campaign that included social-media scavenger hunts and a series of videos that followed a young woman as she explored the fringes of her social network.

It all seemed like overkill. And most of the tech press wasn't exposed to the targeted marketing enough -- if there even was a lot -- to sense whether it was working. Except when Microsoft was pressured to pull an advertisement because critics felt it promoted "sexting"

"The thing about niche marketing is, if you don't hit your niche," IDC mobile analyst William Stofega told seattlepi.com, "you're kind of stuck between a rock and a hard place."

Two weeks ago, a rumor bubbled up that Microsoft and Verizon had sold only 500 Kin phones. Most of the tech media dismissed it as ridiculous (Microsoft never denied or confirmed it), but the writing on the wall was clear: Kin was struggling.

Best Buy had already slashed its Kin retail prices; the lower-end Kin One went from $50 to free and the higher-end Kin Two dropped from $100 to $50. Then, this past Sunday, Verizon quietly cut the Kin One to $30 and the Kin Two to $50.

The price-gouge was likely in response to Microsoft's killing the Kin program.

"It's not surprising, given the things we've heard," Stofega said. "I think (it was) the aggressive pricing in terms of other options on the market. For a little extra, you could go out and get a high-end device from, maybe, HTC."

The phones -- a small vertical-sliding handset and a larger landscape-oriented slider -- got lukewarm reviews and received the most criticism for their price. Many believed Microsoft oversold, and perhaps misrepresented, the Kin phones as smart phones when, really, they were just fancy feature phones.

Arguably the most promising product of the Kin program is an online service called Kin Studio, where a user's media are stored. Kin users can browse or surf their photos by time or location, share photos and videos with their friends, and just surf social networks from within the Silverlight-powered Kin Studio interface.

If Microsoft is "incorporating valuable ideas and technologies from KIN into future Windows Phone releases," as the company said, it might behoove Redmond to incorporate the Kin Studio technology.

Kin's discontinuation doesn't bode well for Microsoft's mobile reputation, which has been foundering while the Apple iPhone, Google Android operating system and Research in Motion BlackBerry brand have been surging ahead in terms of sales. Microsoft's last full mobile-OS release, Windows Mobile 6.5, launched in October to lukewarm reviews and has been most successful with HTC's own interface slapped on top.

Microsoft plans to bring Windows Phone 7 to market by the holidays. Like the Kin OS, Windows Phone 7 incorporates the look and feel of the Zune HD's "Metro" interface. The Kin phones were also the first to include Zune software.

The Kin woes should not necessarily put Windows Phone 7 in a bad light. Though the Kin devices did incorporate some WP7 technology, they were not representative of the full-featured operating system.

But the Kin woes do highlight Microsoft's ongoing struggle in mobile. Once again, Microsoft has misidentified a mobile opportunity, misfired in its execution and failed introduce a "cool" device into a world full of iPhones and Droids.

"Overall," Stofega said, "it's a tough, tough, tough market."