Microsoft's Pink Struggles Spill Over To Sidekick

Microsoft's Pink smartphone project was supposed to give Microsoft much-needed cachet in the mobile market and provide some semblance of a challenge to the iPhone. Instead, Pink is starting to look like a disaster that could further damage Microsoft's already shaky standing in the mobile space.

Pink's struggles, and the Sidekick outage that hit T-Mobile users last week, are the latest examples of disarray in Microsoft's mobile strategy. They also cast into doubt Microsoft's ability to execute on its "three screens and the cloud" vision for tying together PCs, televisions and mobile devices.

According to a source who claims detailed knowledge of Pink, and who back in May provided Channelweb.com with details that have since been reported by other publications (here and here), Pink was doomed from the start by poor decision-making and a management team with next to no mobile experience.

Pink is being developed by Microsoft's Premium Mobile Experiences (PMX) team, a group within the Mobile Communications Business (MCB) of the Entertainment and Devices Division. The group is led by Roz Ho, corporate vice president and an 18-year Microsoft veteran, who was previously general manager for Microsoft's Office For Mac group. Chris Pirich, head of engineering for Pink, came from the Xbox group, and Matt Bencke, business general manager for Pink, came to Microsoft from Boeing with virtually no software development experience.

Microsoft in February 2008 bought Danger, developer of the software and services stack for the Sidekick, for $500 million. The deal was aimed at infusing Pink with mobile industry talent and experience, and Microsoft's goal was to offer a user experience far superior to that of the Sidekick. But in its efforts to make Pink stand out, Microsoft allowed the scope of Pink to grow too large, and that led to the problems Pink faces today, the source told Channelweb.com.

Pink brings together technology from several different Microsoft product groups, but PMX failed to get these groups to commit to delivering their parts of the project on time, according to the source. "Pink has a lot of dependencies -- the marketplace is Zune, and for games it uses XNA. Every little piece uses another division's technology," said the source. "PMX had lofty ideas and goals, but they totally failed to execute these with Pink."

As a result of these difficulties, Microsoft had to shelve plans to include the marketplace and games, and those represent two major holes in Pink that will further erode its chances for success, the source said.

What's more, Pink was originally based on Windows Mobile 7, but repeated Windows Mobile 7 delays caused PMX to switch to Windows CE, which takes longer to implement, the source said.

After acquiring Danger, Microsoft's plan was to run both the Pink and Sidekick businesses and then gradually phase out the latter. But when Pink ran into problems, PMX shifted resources away from the Sidekick and into Pink.

"They killed the Sidekick to save Pink, but now Pink is dying as well," said the source.

Microsoft couldn't be reached for comment on whether it plans to develop future Sidekick models. A spokesperson for T-Mobile, which sells the Sidekick in the U.S., said the company doesn't comment on rumors or speculation.

In any event, the prospect of Microsoft abandoning the Sidekick probably won't come as a surprise to Sidekick users who've spent the past week dealing with a service outage, and who learned over the weekend that the personal information stored on their devices has most likely been lost due to a server failure at Microsoft.

NEXT: Pink's Glaring Lack Of Features ...

Incredibly, Pink, if it ever ships, won't include basic applications such as calendar and alarm clock, nor will it have its own mobile applications marketplace, an element that has been crucial to the iPhone's success. And since Pink is now code complete, PMX won't be able to fill these gaps later on, said the source.

Microsoft couldn't be reached for comment on what features Pink will include if and when it does ship. A spokesperson for Verizon Wireless, the carrier for which Microsoft has been rumored to be developing Pink, said the company doesn't comment on phones that it doesn't currently sell.

According to the source, Pink's shortcomings illustrate Microsoft's unwillingness to utilize the talent it gained from the Danger acquisition, and its steadfast insistence on shaping the Sidekick into a mobile experience that was uniquely Microsoft. Immediately after the deal, PMX made it clear that it wasn't interested in following Danger's creative direction and relegated Danger talent to lowly positions within PMX, the source said.

This point was underscored further when Microsoft laid off a large number of Danger employees in May as part of the first companywide job cuts in its history. Many Danger staffers left Microsoft of their own accord, and the Danger employees that remain are said to be no great fans of Pink, according to a recent Techcrunch report.

Microsoft, to its credit, has begun to acknowledge the serious nature of its Windows Mobile problems. Last month, CEO Steve Ballmer told attendees at a venture capital summit that Microsoft has completely revamped the Windows Mobile team and "pumped in some new talent."

Microsoft says Windows Mobile 7 will bring it up to speed in the mobile space, but the oft-delayed OS probably won't arrive until mid-to-late 2010, during which time Microsoft's competitors will continue advancing their platforms.

Windows Mobile still has a solid footing in the business world, but Microsoft desperately wants to make it more attractive to consumers, and Pink's failure would deliver another gut-punch to these hopes.

Andrew Brust, chief of new technology for twentysix New York, a Microsoft partner in New York, is hopeful that Windows Mobile 7 will succeed, but says he's always skeptical when a company puts so much emphasis on a single product release. Microsoft has been slow to adjust to the smartphone market because it represents a different sort of challenge for the company, he said.

"The mobile space today is enterprise-relevant but consumer-driven, and that's a really unique combination that Microsoft has never had to face before," Brust said.

This article updated on Mon., Oct 12 at 4:10 Pacific time to add comment on Pink's lack of marketplace and games