Can Microsoft's Kin Catch the Mobile Social Networking Wave?

Microsoft CEO Steve Ballmer's comment last September that his company had "screwed up" with Windows Mobile had some theorizing that Microsoft's handheld team was in disarray and probably unable to take on the Apple iPhone and other devices.

Five months later, at the Mobile World Congress in February, Ballmer gave the world a glimpse at Windows Phone OS 7.0. It offered skeptics some hope that, nearly three years after the iPhone's successful launch in 2007, Microsoft was getting back in the game.

And then came yesterday's launch of two new Kin phones based on a distinct OS that Microsoft calls Windows Phone OS for Kin -- apparently a derivative of Windows Phone OS 7.0.

The Kin is clearly not a smartphone, because it doesn't allow downloading of all kinds of apps, analysts said. But it is more than a features phone with texting, because of the way it shares video, texts and other data with a circle of users in three interface capabilities called Kin Loop, Kin Spot and Kin Studio.

Slotting in between a features phone and a smartphone, the Kin is a fairly novel device, one that could reap big rewards for Microsoft and the device's exclusive U.S. carrier, Verizon Wireless, analysts said. That depends on whether the Kins are priced right and come with attractive monthly data plans when they go on sale in May, analysts said.

In fact, because of the Kins' recognition of the almost maniacal texting and social networking habits of teens and 20-somethings, Jack Gold of J. Gold Associates thinks that the Kin phones are an even bigger deal than Windows Phone OS 7. The mobile OS is expected to launch in various devices in the fall.

"The potential win for Microsoft is huge if it can capture even a relatively small fraction of the hundreds of millions of social network users," Gold wrote in a commentary today. "In fact, Kin could dwarf the ... tens of millions potential of its WP7 smart phone."

Gold's rationale: users attracted to Kin won't care for all the things a smartphone like the iPhone or a Google Nexus One can provide, including downloads of thousands of apps. The social networking crowd envisioned in the Kin world isn't oblivious to the value of apps, but favors its own social network above all else, Microsoft believes.

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"If it catches on, Kin could usher in a new class of 'Facebook in your pocket' devices," Gold said.

The appeal to social networkers is so important that Microsoft has even engineered a special emoticon key on the lower right of the Kins' keypads. The key looks like a semicolon/close-parenthesis "smiley," which CIO blogger Al Sacco reports will open a menu with additional emoticons for using in communications instead of words.

Ken Dulaney, an analyst at Gartner Inc., said in an e-mail that the Kin Studio best epitomizes the Kin's social network usability. "Kin Studio is impressive, basically giving you a magazine of your life as you use the device," he wrote. "Being able to know that everything is backed up [in the cloud] and that you can go back to any time period and look at what you [did] eliminates the family album, so to speak."

The Kin Studio, as good as it sounds, is also an insight into how Microsoft could make serious money, as the Studio is backed up in the cloud with Microsoft's Live services, Gold noted. "Kin is a locked-down OS [and] Microsoft controls the ecosystem for Kin as effectively as Apples does for the iPhone," he said. As a result, Kin users have limited ability to run applications locally and are "virtually reliant on the cloud."

That reliance means the Verizon network has to be rock solid and that Microsoft must not be perceived as heavy-handed in deciding what applications and services can run on the device, Gold said.

Pricing, yet to be announced, will play a big role in how young users respond and could lure in those likely to be largely indifferent about how much control Microsoft exerts over its Kin Studio.

"The whole thing comes down to pricing," Dulaney said, noting that if the Kin is priced at $199 and $30 for monthly data service, it won't appear to have much advantage over the iPhone. But if the device is perhaps $49 with a $5 to $15 a month data plan, "it should do well at Verizon."

Analysts took note of how all the U.S. carriers have tried to expand on sales of texting/messaging devices to younger users, seeing some limits on growth in smartphone sales but no end to texting and MMS demand. At AT&T, a big push is on for "quick messaging devices" that are less expensive than smartphones, and Verizon might have picked up on that theme with the Kin.

Analysts have compared some of the Kin's social networking features to the Motoblur service from Motorola. It's built on Android running on a the Cliq phone sold by T-Mobile USA and on the Motorola BackFlip sold by AT&T.

"Kin is the next step up for the devices that were once listed as features phones in the slider classification used by texters," Dulaney noted. "This is way beyond SMS or MMS and into social collaboration. It is a much more focused product than the iPhone."

Matt Hamblen covers mobile and wireless, smartphones and other handhelds, and wireless networking for Computerworld. Follow Matt on Twitter at@matthamblen or subscribe to Matt's RSS feed. His e-mail address is mhamblen@computerworld.com.

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