Microsoft enters mobile Web fray in earnest

BARCELONA (Reuters) - Microsoft took a decisive step into the mobile Web arena with a deal to buy Danger, a mobile software company best known for the Sidekick, to all intents a blueprint for a Google phone.

The software giant said on Monday the acquisition was crucial to its success to win consumers over to its brand of mobile Internet. It did not disclose how much it had agreed to pay for privately held Danger.

Danger was co-founded by Andy Rubin, who is now running Google’s mobile phone project, Android. Google has assembled a community of carriers, cellphone makers, software developers and chipmakers to develop a mobile software platform.

Google hopes hundreds or even thousands of different handset models will eventually be produced based on the Android platform, which is being built with open-source software, meaning it will be able to be freely accessed and adapted.

At the Mobile World Congress wireless fair on Monday, several members of Google’s so-called Open Handset Alliance demonstrated prototypes of the Android platform in action, prominently featuring Google search, maps and mail.

Chipmakers Texas Instruments and NEC had working models, some based on designs by ARM Holdings, which is not a member of the alliance but also demonstrated a prototype on its stand.

The handsets, which Google and its partners stressed bore little resemblance to any phones that might appear in shops later this year, looked unremarkable but did have smooth Web functions -- Google’s primary stated aim.

Rich Miner, Google’s mobile platforms manager, told Reuters in an interview he expected “one, two or three” Android-based phones to be on sale commercially this year.

He said the 34-member Open Handset Alliance -- which includes German carrier T-Mobile, Taiwanese smartphone maker HTC and online marketplace eBay, may become redundant as a fixed group in the long run.

Microsoft Chairman Bill Gates speaks at a keynote address at the Consumer Electronics Show (CES) in Las Vegas, January 6, 2008. Microsoft took a decisive step into the mobile Web arena with a deal to buy Danger, a mobile software company best known for the Sidekick, to all intents a blueprint for a Google phone. REUTERS/Rick Wilking

“We’re still trying to decide whether we will manage this, as open source,” he said.


As the buzz around Google subsided with the understanding that no challenger to Apple’s iPhone was about to be unveiled, attention turned to Microsoft’s surprise acquisition, announced at the Barcelona trade fair in the afternoon.

UK-based research firm CCS Insight called it “a sign Microsoft is stepping up efforts on mobile software to close the gap with Nokia, Apple and others”.

“Everybody’s zoning in on the mobile platform as a way to extend their lives or monetize their future,” said CCS analyst Shaun Collins.

Danger’s T-Mobile Sidekick, also known as the hiptop, is widely considered to be one of the best-designed mobile phones there is for Web applications.

Microsoft, especially in the context of its $40 billion-plus bid for Google rival Yahoo, now looks an increasingly serious contender to become the face of the mobile Web, shaking off its stuffy corporate image.

“With all the excitement about what’s going on in the company right now, this is critical to our future and decisive for our future,” said Robbie Bach, Microsoft’s president of entertainment and devices.

“It completes the picture for us in terms of making the transition from just being on the business side of things to being on the consumer side of things,” he told a news conference at the wireless fair.

Sony Ericsson, known for its stylish Walkman music phones and Cybershot camera phones, said on Sunday it would start producing a line of phones based on Microsoft’s Windows Mobile operating system later this year.

Reporting by Georgina Prodhan; Editing by Jason Neely and Erica Billingham